What changed in this filing

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Item 9A. Controls and Procedures

2025-03-11 compared with 2024-03-22 · 493 added, 468 removed, 795 unchanged (55% of the section changed)

1 unchanged sentence

Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act is processed, recorded, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

The Company carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2023, the end of the period covered by this report.

Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded, as of that time, the disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below.

Notwithstanding the identified material weaknesses, management, including our Chief Executive Officer and Chief Financial Officer, believes the consolidated financial statements included in this Annual Report fairly represent, in all material respects, our financial condition, results of operations and cash flows as of and for the periods presented in accordance with U.S.

Generally Accepted Accounting Principles.

Previously Disclosed Material Weaknesses

As previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022, we identified material weaknesses in our internal control over financial reporting.

During fiscal years 2021, 2022 and 2023, the Company began implementing a remediation plan to address the material weaknesses identified as of December 31, 2021.

The Company has designed, implemented, and operated controls over user access to certain information systems to ensure adequate restriction of users and privileged access to transaction processing applications.

Therefore, management has concluded that this material weakness was remediated as of December 31, 2023.

Further, the Company expanded its finance and accounting team, including hiring a number of additional individuals with the requisite technical accounting and finance knowledge and experience to assist with the enhancement and implementation of internal control policies and procedures related to the accounting matters in our business.

While progress has been made to enhance our internal control over financial reporting, the root cause of the material weaknesses related to the appropriate review and documentation of controls has not yet been addressed.

While the Company has designed, implemented, and operated certain of the necessary controls, we have not been able to consistently document the execution of such controls at an appropriate level of detail and precision.

While we believe that our efforts have improved our internal control over financial reporting and resulted in the remediation of certain of the material weaknesses previously identified, remediation of the remaining material weaknesses existing as of December 31, 2023, as described below will require further validation and testing of design and operating effectiveness over a sustained period of financial reporting cycles.

Additionally, as previously described in Part II, Item 9A of the Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed by FWAC, prior to the Merger, FWAC’s management identified that FWAC’s control around the interpretation and accounting for extinguishment of a significant contingent obligation was not effectively designed or maintained.

That material weakness resulted in the restatement of FWAC’s interim financial statements for the quarters ended June 30, 2022, and September 30, 2022.

In connection with our evaluation of internal control over financial reporting for the year ended December 31, 2023, management concluded this material weakness was remediated.

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) or Rule 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is processed, recorded, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

We carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024, the end of the period covered by this Annual Report.

Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded, as of that time, our disclosure controls and procedures were effective.

Remediation of Previously Identified Material Weaknesses

As most recently disclosed in our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2024, we identified material weaknesses in our internal control over financial reporting related to (i) the lack of appropriate segregation of duties within the accounting and finance groups, (ii) the ineffective design, implementation, and operation of controls relevant to the financial reporting process, specifically related to the documentation of the review of controls, and (iii) the calculation and review of noncontrolling interest.

To remediate the identified material weaknesses, we completed the following remedial actions:

We hired a Chief Financial Officer who has experience in remediating material weaknesses in internal controls and enhancing control environments.

We trained accounting resources to ensure they have the requisite levels of expertise.

We enhanced our processes and controls related to the calculation of noncontrolling interest and allocation of equity between noncontrolling interest and equity.

We reallocated responsibilities across the finance organization to allow for the appropriate segregation of duties to be applied.

We re-evaluated the permissions of user roles within our accounting system in order to establish more appropriate segregation of duties.

We enhanced our internal control documentation for key controls to ensure the appropriate assignment of preparers and reviewers and the establishment of policies and procedures that would require control performers to document the execution of controls with the appropriate level of precision and supporting evidence.

As relevant controls have been designed, implemented, and operated effectively for a sufficient period of time, management, including our Chief Executive Officer and Chief Financial Officer, has concluded the material weaknesses have been remediated as of December 31, 2024.

Management ’ s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting for our Company, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

Internal control over financial reporting consists of policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) are designed and operated to provide reasonable assurance regarding the reliability of the Company's financial reporting and the Company's process for the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Management has conducted an assessment, including testing, of the effectiveness of our internal control over financial reporting as of December 31, 2023.

In making our assessment of internal control over financial reporting, management used the criteria in Internal Control -- Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

Based on this assessment, management, with the participation of the Chief Executive Officer and Chief Financial Officer, concluded that, as of December 31, 2023, the Company’s internal control over financial reporting was not effective due to the material weaknesses in internal control over financial reporting described below.

Material Weaknesses in Internal Control over Financial Reporting

Management identified material weaknesses in our internal control over financial reporting in connection with our assessment as of and for the year ended December 31, 2023.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

The following control deficiencies constitute material weaknesses, either individually or in the aggregate, relating to:

(i) the lack of appropriate segregation of duties within the accounting and finance groups and (ii) the ineffective design, implementation, and operation of controls relevant to the financial reporting process, specifically related to the documentation of the review of controls.

Management ’ s Remediation Plan

The following remedial actions have been identified and initiated as of December 31, 2023:

We will continue to hire and train additional accounting resources that have the requisite levels of experience.

We will reallocate responsibilities across the finance organization to allow for the appropriate segregation of duties to be applied.

We will re-evaluate the permissions of user roles within our accounting system in order to establish more appropriate segregation of duties.

We will continue to enhance our internal control documentation for key controls to ensure the appropriate assignment of preparers and reviewers and the establishment of policies and procedures that would require control performers to document the execution of controls with the appropriate level of precision and supporting evidence.

As we continue to evaluate our internal control over financial reporting, we may determine that additional or different measures to address control deficiencies or modifications to our remediation plan are necessary.

The material weaknesses cannot be considered remediated until the applicable controls are fully implemented, have operated for a sufficient period of time and management has concluded that these controls are operating effectively through testing.

Management has conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2024.

In completing our evaluation of internal control over financial reporting, management used the criteria in Internal Control -- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

Based on this assessment, management, with the participation of the Chief Executive Officer and Chief Financial Officer, concluded that, as of December 31, 2024, the Company’s internal control over financial reporting was effective.

Changes in Internal Control Over Financial Reporting

2 unchanged sentences

Insider Trading Arrangements

On December 15, 2023 , Manuel Chavez, III , our Chief Executive Officer , entered into a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5 - 1 (c) under the Exchange Act.

The trading plan provides for the purchase of an aggregate of up to 142,000 shares of Common Stock.

The trading plan will terminate on September 30, 2024, subject to early termination for certain specified events set forth in the trading plan.

During the fiscal quarter ended December 31, 2023, no other directors or officers (as defined in Rule 16a - 1 (f) under the Exchange Act) adopted or terminated a "Rule 10b5 - 1 trading arrangement" or "non-Rule 10b5 - 1 trading arrangement," as those terms are defined in Regulation S-K, Item 408.

During the fiscal quarter ended December 31, 2024 , no directors or officers (as defined in Rule 16a - 1 (f) under the Exchange Act) adopted or terminated a "Rule 10b5 - 1 trading arrangement" or "non-Rule 10b5 - 1 trading arrangement," as those terms are defined in Regulation S-K, Item 408.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

2 unchanged sentences

The information required by this Item will be included in our definitive proxy statement to be filed with the SEC within 120 days after December 31, 2024 in connection with the Company's 2025 Annual Meeting of Stockholders, and is hereby incorporated by reference into this Form 10-K.

We have adopted comprehensive insider trading policies and procedures that apply to all directors, officers and employees.

These policies are designed to prevent trading on the basis of material nonpublic information and to ensure compliance with applicable securities laws.

The policies include provisions for pre-clearance of trades, blackout periods and the establishment of Rule 10b5-1 trading plans.

A copy of our insider trading policy is filed as an exhibit to this Annual Report on Form 10-K.

EXECUTIVE COMPENSATION

30 unchanged sentences

Description of Securities

Amended and Restated Letter Agreement, dated as of May 11, 2023, by and among FWAC, its executive officers, its directors, and the Sponsor

MVP REIT II, Inc.

Long-Term Incentive Plan

March 22, 2024

Credit Agreement, dated as of September 11, 2024 among MIC, the Lenders party thereto and Harvest Small Cap Partners, L.P.

September 11, 2024

Loan Agreement, dated as of January 10, 2017, by and between MVP Detroit Center Garage, LLC and Bank of America, N.A.

January 12, 2017

Loan Agreement, dated as of November 30, 2018, by and among certain subsidiaries of Legacy MIC named as borrowers party thereto and LoanCore Capital Credit REIT LLC as lender

CMBS Loan Agreement, dated December 6, 2024, by and among the Borrowers party thereto and Argentic Real Estate Finance 2 LLC.

December 11, 2024

Contribution Agreement, dated as of March 29, 2019, and effective as of April 1, 2019, among Legacy MIC, MVP Realty Advisors, LLC, dba The Parking REIT Advisors, Vestin Realty Mortgage I, Inc., Vestin Realty Mortgage II, Inc., and Michael V.

Services Agreement, dated as of March 29, 2019, by and among Legacy MIC, Mobile Infra Operating Partnership, L.P., Vestin Realty Mortgage I, Inc., Vestin Realty Mortgage II, Inc., MVP Realty Advisors, LLC, dba The Parking REIT Advisors, and Michael V.

April 3, 2019

First Amendment to Loan Agreement, dated as of July 9, 2020, by and among certain subsidiaries of Legacy MIC named as borrowers party thereto and LLC Warehouse V LLC as lender and successor-in-interest to LoanCore Capital Credit REIT LLC

November 16, 2020

Second Amendment to Loan Agreement, dated as of December 8, 2020, by and among certain subsidiaries of Legacy MIC as borrowers party thereto and LLC Warehouse V LLC as lender and successor-in-interest to LoanCore Capital Credit REIT LLC

March 31, 2021

Third Amendment to Loan Agreement, dated as of December 8, 2021, by and among Legacy MIC as guarantor, certain subsidiaries of Legacy MIC as borrowers party thereto, and LoanCore 2021-CRE4 Issuer Ltd.

as lender and successor-in-interest to LoanCore Capital Credit REIT LLC

March 30, 2022

Equity Purchase and Contribution Agreement, dated as of January 8, 2021, by and among Legacy MIC, Mobile Infra Operating Partnership, L.P., Michael V.

Shustek, Vestin Realty Mortgage II, Inc., Vestin Realty Mortgage I, Inc., and Color Up, LLC

Loan Agreement, dated as of January 10, 2017, by and between MVP Detroit Center Garage, LLC and Bank of America, N.A.

January 12, 2017

1 unchanged sentence

August 31, 2021

Stockholders Agreement, dated as of August 25, 2021, by and between Legacy MIC and the Investors identified on the signature pages thereto

August 31, 2021

Assignment of Claims, Causes of Action, and Proceeds, dated as of August 25, 2021, by Legacy MIC in favor of Michael V.

3 unchanged sentences

August 31, 2021

First Amendment to Services Agreement, dated as of August 25, 2021, by and among Legacy MIC, MVP REIT II Operating Partnership, L.P., Vestin Realty Mortgage I, Inc., Vestin Realty Mortgage II, Inc., MVP Realty Advisors, LLC, and Michael V.

August 31, 2021

First Amendment to Contribution Agreement, dated as of August 25, 2021, by and among Legacy MIC, Vestin Realty Mortgage I, Inc., Vestin Realty Mortgage II, Inc., MVP Realty Advisors, LLC, and Michael V.

August 31, 2021

Securities Purchase Agreement, dated as of November 2, 2021, by and among Legacy MIC, Mobile Infra Operating Partnership, L.P., and HSCP Strategic III, L.P.

November 4, 2021

Class A Unit Agreement, dated as of November 2, 2021, by and between Mobile Infra Operating Partnership, L.P.

and HSCP Strategic III, L.P.

November 4, 2021

Amended and Restated Registration Rights Agreement, dated as of November 2, 2021, by and among Legacy MIC, Color Up, LLC and HSCP Strategic III, L.P.

November 4, 2021

Credit Agreement, dated as of March 29, 2022, by and among Legacy MIC, Mobile Infra Operating Partnership, L.P., certain subsidiaries of Legacy MIC, as borrowers party thereto, KeyBanc Capital Markets and KeyBank, National Association, as administrative agent and lender

April 1, 2022

First Amendment to Credit Agreement, dated as of November 17, 2022, by and among Mobile Infra Operating Partnership, L.P., KeyBank National Association, and the other financial institutions party thereto

November 22, 2023

Waiver and Second Amendment to Credit Agreement, dated as of August 25, 2023, by and among Mobile Infra Operating Partnership, L.P., Legacy MIC, each subsidiary of Legacy MIC party thereto, KeyBank National Association, and the other financial institutions party thereto

August 31, 2023

Third Amendment to Credit Agreement, dated as of March 1, 2024, by and among Mobile Infra Operating Partnership, L.P., Legacy MIC, each subsidiary of Legacy MIC party thereto, KeyBank National Association, and the other financial institutions party thereto

March 5, 2024

Employment Agreement, dated as of August 25, 2021, by and between Legacy MIC and Manuel Chavez

32 unchanged sentences

August 31, 2023

Sponsor Lock-Up Agreement, dated as of December 13, 2022, by and among the Sponsor, FWAC, and Legacy MIC

December 14, 2022

Seller Lock-up Agreement, dated as of December 13, 2022, by and among FWAC, Legacy MIC, and certain security holders of Legacy MIC

December 14, 2022

Second Amended and Restated Sponsor Agreement, dated as of June 15, 2023, by and among FWAC, Legacy MIC, Sponsor, and certain holders of FWAC Class B Shares

12 unchanged sentences

April 11, 2023

Insider Trading Policy

List of subsidiaries of MIC

August 31, 2023

Consent of Deloitte & Touche LLP, independent registered public accounting firm of MIC

Certification of Principal Executive Officer Required Under Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended

Certification of Principal Financial Officer Required Under Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended

Certification of Chief Executive Officer and Chief Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended and 18 U.S.C.

Certification of Principal Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Co-Principal Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer and Co-Principal Financial Officers pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Policy for the Recovery of Erroneously Awarded Compensation

March 22, 2024

Inline XBRL Instance Document

6 unchanged sentences

Filed concurrently herewith.

Management compensatory agreement

Indicates a management or compensatory plan

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Stephanie Hogue

President and Chief Financial Officer

March 11, 2025

/s/ Paul Gohr

Chief Financial Officer

March 11, 2025

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

5 unchanged sentences

/s/ Stephanie Hogue

President and Chief Financial Officer

President and Director

March 11, 2025

Stephanie Hogue

(Principal Financial Officer and Principal Accounting Officer)

(Co-Principal Financial Officer)

/s/ Paul Gohr

Chief Financial Officer

March 11, 2025

(Co-Principal Financial Officer and Principal Accounting Officer)

/s/ David Garfinkle

21 unchanged sentences

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Mobile Infrastructure Corporation and subsidiaries (the "Company") as of December 31, 2023 and 2022, the related consolidated statements of operations, changes in equity, and cash flows, for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the "financial statements").

We have audited the accompanying consolidated balance sheets of Mobile Infrastructure Corporation and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations, changes in equity, and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes and schedule III listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

34 unchanged sentences

389,730 402,879

10,655 11,134

Cash – restricted

Accounts receivable, net

Other assets, net

Deferred offering costs

Assets held for sale

Due from related parties

Notes receivable

$ 415,062 $ 423,237

3 unchanged sentences

Revolving credit facility, net

58,523 72,731

Line of credit

Accounts payable and accrued expenses

10,634 14,666

Accrued preferred distributions

Accrued preferred distributions and redemptions

Earn-Out liability

Due to related parties

Liabilities held for sale

Total liabilities

3 unchanged sentences

Preferred stock Series 1, $ 0.0001 par value, 97,000 shares authorized, 18,165 and 36,677 shares issued and outstanding, with a stated liquidation value of $ 18,165,000 and $ 36,677,000 as of December 31, 2024 and December 31, 2023, respectively

Preferred stock Series 2, $ 0.0001 par value, 60,000 shares authorized, 46,000 shares issued and converted, with a stated liquidation value of zero as of December 31, 2023 and December 31, 2022

Preferred stock Series 2, $ 0.0001 par value, 60,000 shares authorized, 46,000 issued and converted (stated liquidation value of zero as of December 31, 2024 and December 31, 2023)

Common stock, $ 0.0001 par value, 500,000,000 shares authorized, 40,376,974 and 27,858,539 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively

16 unchanged sentences

For the Years Ended December 31,

Managed property revenue

Base rental income

$ 8,165 $ 8,345

Management income

Percentage rental income

22,107 20,329

Total revenues

30,272 29,101

Operating expenses

6 unchanged sentences

Organizational, offering and other costs

Total operating expenses

60,504 34,897

Total expenses

Interest expense, net

( 13,910 ) ( 12,912 )

Gain (loss) on sale of real estate

Gain on sale of real estate

Other income, net

Change in fair value of Earn-Out liability

PPP loan forgiveness

Total other, net

( 8,006 ) ( 12,530 )

( 38,238 ) ( 18,326 )

Total other expense

Net loss attributable to non-controlling interest

( 13,115 ) ( 10,207 )

Net loss attributable to stockholders

$ ( 25,123 ) $ ( 8,119 )

Net loss attributable to Mobile Infrastructure Corporation’s stockholders

Preferred stock distributions declared - Series A

( 197 ) ( 216 )

Preferred stock distributions declared - Series 1

( 2,555 ) ( 2,784 )

Preferred stock distributions declared - Series 2

Net loss attributable to common stockholders

$ ( 32,475 ) $ ( 11,119 )

Net loss attributable to Mobile Infrastructure Corporation’s common stockholders

Basic and diluted loss per weighted average common share:

Net loss per share attributable to stockholders - basic and diluted

$ ( 2.45 ) $ ( 0.85 )

Net loss per share attributable to Mobile Infrastructure Corporation’s common stockholders - basic and diluted

Weighted average common shares outstanding, basic and diluted

13,244,388 13,089,848

The accompanying notes are an integral part of these consolidated financial statements.

3 unchanged sentences

Preferred stock

Balance, December 31, 2021 (as previously reported)

42,673 $ — 7,762,375 $ — $ 3,319 $ 196,176 $ ( 101,049 ) $ 107,378 $ 205,824

Retroactive application of the recapitalization

Balance, December 31, 2021 (as adjusted)

Balance, December 31, 2022

42,673 $ — 13,089,848 $ — $ 3,319 $ 193,176 $ ( 109,168 ) $ 99,681 $ 187,008

1 unchanged sentence

— — — — — 19 — 7,465 7,484

Distributions to non-controlling interest holders

— — — — — — — ( 463 ) ( 463 )

Declared distributions – Series A ($ 75.00 per share)

2 unchanged sentences

— — — — — ( 2,555 ) — — ( 2,555 )

Declared distributions – Series 2 ($ 0.10 ) per share)

— — — — — ( 4,600 ) — — ( 4,600 )

Conversions - Series 1

( 3,134 ) — 967,346 — — 778 — — 778

Conversions - Series A

( 50 ) — 13,883 — — 13 — — 13

Conversions - Series 2

( 46,000 ) — 13,787,462 2 — — — — 2

Reverse Recapitalization, net of issuance costs

46,000 — — — — 53,723 — — 53,723

Allocation of equity to non-controlling interest

— — — — — 21,827 — ( 21,827 ) —

— — — — — — ( 25,123 ) ( 13,115 ) ( 38,238 )

Balance, December 31, 2023

4 unchanged sentences

— — — — — — — ( 208 ) ( 208 )

Declared distributions – Series A ($ 75.00 per share)

Purchase of minority interest in subsidiary

— — — — — 144 — ( 1,644 ) ( 1,500 )

Declared distributions – Series 1 ($ 70.00 per share)

Issuance of common stock

— — 500,000 — — 1,740 — — 1,740

Share repurchase program

— — ( 419,188 ) — — ( 1,326 ) — — ( 1,326 )

Redemptions - Series 1

( 10,554 ) — — — — ( 11,057 ) — — ( 11,057 )

Redemptions - Series A

( 280 ) — — — — ( 280 ) — — ( 280 )

Declared distributions – Series A ($ 57.50 per share)

— — — — — ( 134 ) — — ( 134 )

Declared distributions – Series 1 ($ 55.00 per share)

4 unchanged sentences

( 583 ) — 192,656 — — 171 — — 171

Conversions - Series 2

( 46,000 ) — 13,787,462 2 — — — — 2

Reverse Recapitalization, net of issuance costs

Allocation of equity to non-controlling interest

— — 9,381,458 — — 53,243 — ( 53,279 ) ( 36 )

Net income (loss)

— — — — — — ( 5,765 ) ( 2,616 ) ( 8,381 )

7 unchanged sentences

Cash flows from operating activities:

$ ( 38,238 ) $ ( 18,326 )

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization expense

1 unchanged sentence

Loss on extinguishment of debt

Gain on settlement of indemnification liability

PPP loan forgiveness

Gain on settlement of liability

Loss on interest rate cap

(Gain)/Loss on sale of real estate

Gain on sale of real estate

Equity based payment

2 unchanged sentences

Changes in operating assets and liabilities

Due to and from related parties

Due to/from related parties

Accounts payable and accrued expenses

Indemnification liability

Deferred offering costs

( 3,022 ) ( 2,086 )

Other assets, net

( 101 ) ( 267 )

Deferred revenue

Accounts receivable

( 420 ) 2,182

Net cash provided by (used in) operating activities

( 2,125 ) 1,509

Net cash (used in) operating activities

Cash flows from investing activities:

Capital expenditures

( 1,821 ) ( 2,408 )

Capitalized technology

Purchase of investment in real estate

Proceeds from sale of investment in real estate

Net cash (used in) investing activities

( 346 ) ( 19,442 )

Proceeds on sale of investment in real estate

Net cash provided by (used in) investing activities

Cash flows from financing activities

1 unchanged sentence

Payments on notes payable

( 14,085 ) ( 58,755 )

Payments on line of credit

Payments on Revolving Credit Facility

Proceeds from notes payable

Proceeds from reverse recap, net of payment of equity issuance costs

2 unchanged sentences

Distributions to non-controlling interest holders

Net cash provided by financing activities

Purchase of minority interest in subsidiary

Share repurchase plan

Shares repurchased for vesting of employee awards

Preferred redemption payments

Preferred dividend payments

Net cash (used in) provided by financing activities

Net change in cash, cash equivalents and restricted cash

5,737 ( 5,722 )

Cash, cash equivalents and restricted cash, beginning of period

10,974 16,696

Cash, cash equivalents and restricted cash, end of period

$ 16,711 $ 10,974

Reconciliation of Cash, Cash Equivalents and Restricted Cash:

Cash, cash equivalents at beginning of period

Cash and cash equivalents and restricted cash, beginning of period

Cash and cash equivalents and restricted cash, end of period

Reconciliation of Cash and Cash Equivalents and Restricted Cash:

Cash and cash equivalents at beginning of period

Restricted cash at beginning of period

Cash, cash equivalents and restricted at beginning of period

$ 10,974 $ 16,696

Cash and cash equivalents and restricted cash at beginning of period

Cash and cash equivalents at end of period

Restricted cash at end of period

Cash, cash equivalents and restricted at end of period

$ 16,711 $ 10,974

Cash and cash equivalents and restricted cash at end of period

Supplemental disclosures of cash flow information:

Interest Paid

$ 12,740 $ 10,613

Non-cash investing and financing activities:

Dividends declared not yet paid

$ 2,752 $ 3,000

Distributions paid in common stock

Distributions paid-in-kind - Series 2

Distributions declared not yet paid

Preferred distributions paid in common stock

Right of use asset and lease liability

Note receivable related to disposition of property

Requested preferred redemptions not yet paid

Common stock issued as loan fees

Shares issued or to be issued in exchange for compensation

Series 2 Preferred Stock dividend paid-in-kind

Accrued capital expenditures

$ 647 $ 1,371

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

December 31, 2024

Note A — Organization and Business Operations

Note 1 — Organization and Business Operations

Mobile Infrastructure Corporation (formerly known as Fifth Wall Acquisition Corp.

4 unchanged sentences

As of December 31, 2024 , we own 40 parking facilities in 20 separate markets throughout the United States, with a total of approximately 15,100 parking spaces and approximately 5.2 million square feet.

We also own approximately 0.2 million square feet of retail/commercial space adjacent to its parking facilities.

We also own approximately 0.2 million square feet of commercial space adjacent to our parking facilities.

FWAC was a blank check, Cayman Islands exempted company, incorporated on February 19, 2021 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more business entities.

10 unchanged sentences

The Operating Company is managed by a board of directors, one appointed by the Company and one appointed by the other members of the Operating Company.

Currently, the two directors of the Operating Company are Manuel Chavez, III, our Chief Executive Officer and a director, and Stephanie Hogue, our President, Chief Financial Officer and a director.

Currently, the two directors of the Operating Company are Manuel Chavez, III, our Chief Executive Officer and a director, and Stephanie Hogue, our President and a director.

The Company owns approximately 90.0 % of the Common Units of the Operating Company.

Color Up, LLC, a Delaware limited liability company (“Color Up”) and HSCP Strategic III, LP, a Delaware limited partnership ( “HS3” ), are also members of the Operating Company and own approximately 39.5 % and 9.5 %, respectively, of the outstanding Common Units.

Color Up is our largest stockholder and is controlled by Mr.

Hogue and, Jeffrey Osher, a director of the Company.

HS3 is controlled by Mr.

The remaining Common Units are held by certain of our executive officers and directors (directly or indirectly) and outside investors.

The Company is publicly traded on the NYSE American under the ticker “BEEP.” As a result of the Merger:

5 unchanged sentences

and Harvest Small Cap Partners Master, Ltd., entities controlled by Mr.

Osher, and Bombe-MIC Pref, LLC, an entity controlled by Mr.

Osher, co-chair of the Company's board of directors, and Bombe-MIC Pref, LLC, an entity controlled by Mr.

Chavez and of which Ms.

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Pursuant to the terms and conditions of the Preferred Subscription Agreement, on December 31, 2023, the Series 2 Preferred Stock converted into 13,787,462 shares of our common stock, inclusive of 1,253,404 shares of our common stock issued as dividends to the Preferred PIPE Investors.

On May 27, 2022, the Company entered into an Agreement and Plan of Merger (the “MIT Merger Agreement”) by and between the Company and Mobile Infrastructure Trust, a Maryland real estate investment trust (“MIT”), which is 100% owned by Bombe Asset Management LLC (“Bombe”), an Ohio limited liability company owned by Mr.

Chavez and Ms.

Pursuant to the terms of the MIT Merger Agreement, the Company would merge with and into MIT, with MIT continuing as the surviving entity resulting from the transaction.

Prior to and as a condition to the merger with MIT, MIT expected to undertake an initial public offering (the “MIT IPO”) of its common shares of beneficial interest.

Also, in March 2022, the Company had entered into an agreement with MIT, requiring the Company to be allocated, bear and (where practicable) pay directly certain costs and expenses related to the merger with MIT and the MIT IPO.

In connection with the execution of the Merger Agreement with FWAC, the MIT Merger Agreement and the cost allocation agreement with MIT were terminated.

During the year ended December 31, 2022, the Company incurred costs of approximately $ 4.6 million pursuant to the cost allocation agreement with MIT.

Such amounts are included in organizational, offering and other costs on the Consolidated Statements of Operations.

Accounting Treatment of the Merger and Retroactive Equity Application

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The business affairs of the Company are controlled by the Board consisting of eight individuals, seven of whom were board members of Legacy MIC and one designated by FWAC (the Board has subsequently reduced to seven individuals);

The management of the Company is led by Legacy MIC’s Chief Executive Officer, Manuel Chavez, III, and President and Chief Financial Officer, Stephanie Hogue;

The management of the Company is led by Legacy MIC’s Chief Executive Officer, Manuel Chavez, III, and President and then-Chief Financial Officer, Stephanie Hogue;

Legacy MIC was significantly larger than FWAC in terms of revenue, total assets (excluding cash) and employees.

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In accordance with guidance applicable to these circumstances, the equity structure has been retroactively recast in all comparative periods up to the Closing Date, to reflect the equivalent number of shares of our common stock based on the exchange ratio of 1.5 established in the Merger.

Note B — Summary of Significant Accounting Policies

Note 2 — Summary of Significant Accounting Policies

Basis of Accounting

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Going Concern

Going Concern—The accompanying consolidated financial statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The going concern basis assumes that the Company will be able to meet its obligations and continue its operations one year from the date of the issuance of the Annual Report, which is dependent upon the Company’s ability to effectively implement plans related to the secured debt that matures within one year after the date of the issuance of the Annual Report.

The Company has incurred net losses since its inception and anticipates net losses for the near future.

As of December 31, 2023, the Company has $ 96.3 million of debt due within twelve months.

In February 2024, the Company refinanced $ 5.5 million of notes payable maturing in March 2024 with a new maturity date of March 1, 2029.

After the completion of these refinancing transactions, the Company has $ 90.8 million of debt maturing within twelve months of the date of the issuance of the Annual Report which is comprised of $ 58.7 million related to the Revolving Credit Facility and $ 32.1 million of notes payable.

The Company is currently analyzing financial and strategic alternatives in order to satisfy these debt maturities.

While there can be no assurance that the Company will satisfy the debt prior to or at maturity, management has determined it is probable that it will be able to address these maturities by (i) refinancing the Revolving Credit facility or executing extension options through June 2025 made available under the Third Amendment to the Credit Agreement effective March 1, 2024 and (ii) refinancing the notes payable and/or selling the real estate investments and utilizing the sales proceeds to satisfy the related notes payable.

As such the Company has concluded that these plans alleviate substantial doubt about the Company’s ability to continue as a going concern.

The accompanying consolidated financial statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The going concern basis assumes that we will be able to meet our obligations and continue our operations one year from the date of the issuance of the Annual Report, which is dependent upon our ability to effectively implement plans related to the Line of Credit and a note payable that mature within one year after the date of the issuance of the Annual Report.

We have incurred net losses since our inception and anticipate net losses for the near future.

We have $ 29.9 million of debt due within twelve months of the date of issuance of this Annual Report which is comprised of $ 27.2 million related to the Line of Credit (as defined herein) and a $ 2.7 million note payable.

We do not currently have sufficient cash on hand, liquidity or projected future cash flows to repay these outstanding amounts and interest due upon maturity.

These conditions and events raise substantial doubt about the Company’s ability to continue as a going concern.

We are currently analyzing alternatives in order to satisfy these debt maturities.

We plan to refinance the Line of Credit and note payable prior to their maturities.

However, as refinancing is outside of our control, we plan to sell real estate assets as needed to satisfy the obligations.

Management has determined it is probable that it will be able to successfully implement these plans.

As such, we have concluded that these plans alleviate substantial doubt about the Company’s ability to continue as a going concern.

Consolidation

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Concentration

We had fourteen and fifteen parking operators during the years ended December 31, 2023 and 2022, respectively.

One tenant/operator, SP + Corporation (Nasdaq:

SP) (“SP+”), represented 61.3 % and 60.5 % of our revenue, excluding commercial revenue, for the years ended December 31, 2023 and 2022, respectively.

Premier Parking Service, LLC represented 12.1 % and 12.4 % of our revenue, excluding commercial revenue, for the years ended December 31, 2023 and 2022, respectively.

Our operators may act as agents collecting revenues on our behalf or may act as lessee if under a lease agreement.

The revenue from locations where Metropolis Technologies, Inc.

(“Metropolis”) acts as either a lease tenant or an operator agent represented 55.7 % and 61.3 % of our revenue, excluding commercial revenue, for the years ended December 31, 2024 and 2023, respectively.

Revenue from locations where LAZ Parking ("LAZ") acts as either a lease tenant or an operator agent represented 15.3 % and 3.2 % of our revenue, excluding commercial revenue, for the years ended December 31, 2024 and 2023, respectively.

In addition, we had concentrations in Cincinnati ( 18.8 % and 19.4 %), Detroit ( 10.4 % and 10.3 %), and Chicago ( 9.2 % and 9.1 %) based on gross book value of real estate as of December 31, 2024 and 2023, respectively.

As of December 31, 2023 and 2022, 60.1 % and 59.2 % of our outstanding accounts receivable balance, respectively, was with SP+.

We had concentrations of our outstanding accounts receivable balance with Metropolis of 31.9 % and 60.1 % as of December 31, 2024 and 2023, respectively.

During the year ended December 31, 2024, the majority of these receivable balances represent cash paid by parkers that was collected on our behalf by these operators.

All assets acquired and liabilities assumed in an acquisition of real estate accounted for as a business combination are measured at their acquisition date fair values.

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In performing the third step, we utilize market data such as sales price per stall on comparable recent real estate transactions to estimate the fair value of the real estate assets.

We also utilize expected net sales proceeds to estimate the fair value of any centers that are actively being marketed for sale.

See Note O for additional discussion regarding impairment of long-lived assets.

We also utilize expected net sales proceeds to estimate the fair value of any properties that are actively being marketed for sale.

See Note 15 for additional discussion regarding impairment of long-lived assets.

At least annually, we review indefinite-lived intangible assets for indicators of impairment.

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Restricted cash primarily consists of escrowed tenant improvement funds, real estate taxes, capital improvement funds, insurance premiums and other amounts required to be escrowed pursuant to loan agreements.

The majority of our revenue is rental income derived from leases of our real estate assets.

Revenue Recognition

During 2024, 29 of our parking facilities converted from lease arrangements with operators to contracts with the operator to provide services for a set fee.

Under these contracts, the operators will run the day-to-day activities at the facilities under our direction.

We recognize revenue and expenses on a gross basis as we have determined we are the principal in these arrangements.

These management contracts are accounted for in accordance with ASC Topic 606, Revenue from Contracts with Customers, and the revenues associated with these contracts are recorded as Managed Property Revenue in the Consolidated Statement of Operations.

Taxes assessed by a governmental authority that are collected from a customer are excluded from revenue.

See Note 4 for additional discussion regarding managed property revenues.

A portion of our revenue is rental income derived from leases of our real estate assets.

We account for our leases in accordance with ASC Topic 842, Leases (“ASC 842” ).

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Additionally, we may record a general reserve based on a review of operating lease receivables at a company level to ensure they are properly valued based on analysis of historical bad debt, outstanding balances, and the current economic climate.

Receivables on our Consolidated Balance Sheets exclude amounts removed related to tenants considered to be non-creditworthy, which were not material as of December 31, 2023 and 2022.

Receivables on our Consolidated Balance Sheets exclude amounts removed related to tenants considered to be non-creditworthy, which were approximately $ 0.1 million as of December 31, 2024 and not material as of December 31, 2023.

Allowance for Credit Losses

Accounts receivable is primarily comprised of amounts owed to us for services provided under our managed property contracts.

In addition, as of December 31, 2024, we have a note receivable related to a property sale that was collected in full subsequent to year-end.

Amounts are recorded at the invoiced amount net of an allowance for doubtful accounts, if necessary.

We apply judgment in assessing the ultimate realization of our receivables and we estimate an allowance for doubtful accounts based on various factors, such as the aging of our receivables, historical experience, and the financial condition of our obligors.

Allowance for doubtful accounts was approximately $ 0.1 million as of December 31, 2024 and immaterial as of December 31, 2023.

Investments in Real Estate

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thus, we have not recorded any uncertain tax positions as of December 31, 2024 and 2023 .

Reportable Segments

Our principal business is the ownership, operation and management of parking facilities at a consolidated level.

We do not distinguish our principal business, or group our operations, by geography or size for purposes of measuring performance.

Accordingly, we have presented our results as a single reportable segment.

Recently Issued Accounting Standards

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December 31, 2024

We are currently evaluating the impact the adoption of this standard will have on our consolidated financial statements.

We adopted this standard on December 31, 2024.

Refer to Footnote 18 - Segment Information.

ASU 2023 - 09—Income Taxes (TOPIC 740 ):

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We are currently evaluating the impact the adoption of this standard will have on our disclosures.

Note C – Reverse Recapitalization

As described in Note A, the Merger closed on August 25, 2023.

ASU 2024 - 01—Stock Compensation (TOPIC 718 ):

Scope Application of Profits Interest and Similar Awards The amendment clarifies how an entity determines whether a profits interest or similar award is ( 1 ) within the scope of ASC 718 or ( 2 ) not a share-based payment arrangement and therefore within the scope of other guidance.

January 1, 2025 We evaluated the impact of adoption of this standard and noted no changes were needed on our consolidated financial statements.

ASU 2024 - 03—Income Statement:

Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220 - 40 ) This amendment requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements for public business entities December 31, 2027 We are currently evaluating the impact the adoption of this standard will have on our disclosures.

Note 3 – Reverse Recapitalization

As described in Note 1, the Merger closed on August 25, 2023.

In connection with the Merger:

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• 660,329 LTIP Units.

The following table reconciles the elements of the Merger to the consolidated statements of cash flows and the consolidated statement of changes in stockholder's equity/(deficit) for the twelve months ended December 31, 2023 (in thousands):

Fair value of Series 2 Preferred Stock

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1,900,000 FWAC Class B Shares that converted to the Company’s common stock are subject to an earn-out structure (the “Earn-Out Shares”) under terms outlined in the Second Amended and Restated Sponsor Agreement.

The Earn-Out Shares vest if certain milestones related to share price are achieved as further described in Footnote I.

Because the shares have voting rights but have contingent vesting conditions, we have included the shares as issued but not outstanding on the face of the Consolidated Balance Sheets.

The Earn-Out Shares vest if certain milestones related to share price are achieved as further described in Footnote 15.

Because the shares have voting rights but have contingent vesting conditions, we consider the shares to be issued but not outstanding.

The estimated fair value of the Earn-Out Shares was recorded as approximately $ 5.8 million as of the Closing Date and is presented as earnout liability on the Consolidated Balance Sheets.

We will estimate the fair value of this liability at each reporting date during the contingency period and record any changes to our Consolidated Statement of Operations.

See Footnote O for additional fair value discussion.

We estimate the fair value of this liability at each reporting date during the contingency period and record any changes to our Consolidated Statement of Operations.

See Footnote 15 for additional fair value discussion.

We allocated $ 0.9 million of offering costs to the Earn-Out Shares, which was recorded as part of Organization, Offering, and Other Costs on the Consolidated Statements of Operations.

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As a result, the excess in fair value was treated as non-cash compensation and was recorded as Preferred Series 2 issuance expense on the Consolidated Statements of Operations.

Note D — Acquisitions and Dispositions of Investments in Real Estate

In February 2023, we sold a parking lot located in Wildwood, New Jersey for $ 1.5 million, resulting in a gain on sale of real estate of approximately $ 0.7 million.

We received net proceeds of approximately $ 0.3 million after the repayment of the outstanding mortgage loan, interest and transaction costs.

In February 2024, we disposed of our Cincinnati Race Street location for $ 3.15 million.

As part of the agreement, we entered into a financing arrangement with the buyer.

Note 4 — Managed Property Revenues

Contracts with customers

At our parking facilities, we have a performance obligation to provide access to our property and space for the parker's vehicle.

As compensation for that service, we are entitled to fees that will vary based on the level of usage.

Substantially all of our managed property revenues come from the following two types of arrangements:

Transient Parkers and Contract Parkers.

We generally do not have costs associated with obtaining parking contracts as we are not obligated to pay commissions or incur additional costs to fulfill our responsibility.

Revenue transactions occur over time but are generally completed within a single day for Transient Parkers and by the end of the month for Contract Parkers.

Therefore we do not have any remaining performance obligations at the end of the period.

We apply the practical expedient that permits exclusion of information about the remaining performance obligations that have original expected durations of one year or less.

Transient Parkers

Transient Parkers include customers who arrive at our parking facilities and have the right to park in any open spot not otherwise marked as reserved.

The contract is entered into and approved by the customer entering the lot and parking based on customary business practices.

The term of the contract and duration of parking is determined by the customer, who can leave at any time upon paying.

The transaction price is determined using the hourly or fixed rate set at the facility, and the full transaction price is allocated to the single performance obligation.

Revenue is recognized the day the parking facility is accessed.

Contract Parkers

Contract parkers include customers who pay, generally in advance, to have the right to access the facility for a set period.

The access will generally be for a calendar month and may be restricted to certain days or times based on the terms of the contract.

The transaction price is determined using the parking fee agreed upon and paid prior to use, with no variability or concession based on usage level, and the full transaction price is allocated to the single performance obligation.

Revenue is recognized over the period to which the fee relates.

Disaggregation of revenue

We disaggregate revenue from contracts with customers by Transient Parkers and Contract Parkers.

We have concluded that such disaggregation of revenue best depicts the overall nature and timing of our revenue and cash flows affected by the economic factors of the respective contractual arrangement.

Disaggregated revenue for the year ended December 31, 2024 is as follows (dollars in thousands):

For the year ended December 31, 2024

Transient Parkers

Contract Parkers

Ancillary Revenue (1)

Total Managed Property Revenue

Ancillary revenue includes contracted revenue for other uses outside of parking, such as billboard revenue, and is recognized over time.

Contract balances

The timing of revenue recognition, billings and cash collections results in accounts receivable and contract liabilities.

Accounts receivable represent amounts where we have an unconditional right to the consideration and therefore only the passage of time is required for us to receive consideration due from the customer.

Receivables may be from parking customers who have a contractual obligation to pay for their usage or from the operators of the facilities who have collected parking fees on our behalf.

As of December 31, 2024, we had $ 3.0 million of outstanding accounts receivable related to our managed property revenue.

It is our standard procedure to bill Contract Parkers in the month prior to when they will be using the facility in accordance with agreed-upon contractual terms.

Billing typically occurs prior to revenue recognition, resulting in contract liabilities.

The majority of any contract liability will be recognized at end of the following month.

Changes in deferred revenue primarily include prepayments for future parking months and recognition of previously deferred revenue.

No material amounts in deferred revenue represent prepayments for a period longer than a single month.

As of December 31, 2024, we had approximately $ 0.2 million of deferred managed property revenue included in Accounts Payable and Accrued Expenses on the Consolidated Balance Sheets.

There was no deferred managed property revenue as of December 31, 2023.

Note 5 — Acquisitions and Dispositions of Investments in Real Estate

In February 2024, we disposed of our Cincinnati Race Street location for $ 3.15 million, resulting in a loss on sale of real estate of approximately $ 0.1 million.

As part of the agreement, we entered into a financing arrangement with the buyer with the property as collateral.

Under the terms of the financing arrangement, the buyer will pay interest of 8.0 % on a $ 3.12 million dollar note for a term of 24 months, at which time the principal amount of the loan will be due.

The following table is a summary of the one parking asset acquisition completed during the year ended December 31, 2022 ( dollars in thousands).

222 Sheridan Bricktown Garage LLC

Oklahoma City, OK

555 0.64 15,628 $ 17,513

The following table is a summary of the allocated acquisition value of the property acquired during the year ended December 31, 2022 ( dollars in thousands).

In-Place Lease

222 Sheridan Bricktown Garage LLC

$ 1,314 $ 16,020 $ 179 $ 17,513

In September 2022, we sold a parking lot located in Canton, Ohio for $ 0.7 million, resulting in a loss on sale of real estate of approximately $ 0.1 million.

The note is recorded as Note Receivable on the Consolidated Balance Sheets and the interest income is recorded as Other Income on the Consolidated Statements of Operations.

The Note Receivable was paid off in full in February 2025.

In July 2024, we sold one parking lot in Clarksburg, West Virginia for approximately $ 0.5 million, resulting in an immaterial loss on sale of real estate.

We received proceeds of approximately $ 0.4 million, after transaction costs, which were used to pay down a portion of the outstanding balance on the Revolving Credit Facility, as defined below.

In November 2024, we sold a parking lot located in Indianapolis, Indiana for approximately $ 4.6 million, resulting in a gain on sale of real estate of approximately $ 2.7 million.

We received proceeds of approximately $ 4.5 million, after transaction costs, which were used to pay down a portion of the outstanding balance on the Revolving Credit Facility.

In February 2023, we sold a parking lot located in Wildwood, New Jersey for $ 1.5 million, resulting in a gain on sale of real estate of approximately $ 0.7 million.

We received net proceeds of approximately $ 0.3 million after the repayment of the outstanding mortgage loan, interest and transaction costs.

Note E — Intangible Assets

Note 6 — Intangible Assets

Intangible assets and related accumulated amortization consisted of the following for the years ended December 31, 2024 and 2023 (dollars in thousands):

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Gross carrying

Acquired in-place leases

In-place lease value

$ 2,418 $ 2,119 $ 2,443 $ 1,845

Lease commissions

182 136 165 106

Indefinite lived contract

3,160 — 3,160 —

Acquired technology and other

Acquired technology

4,485 1,498 4,402 1,009

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Acquired in-place leases

Lease commissions

Acquired Technology

$ 291 $ 23 $ 481

Note F — Notes Payable

Note 7 — Debt

As of December 31, 2024 and 2023 , the principal balances on notes payable are as follows (dollars in thousands):

Original Debt

MVP Memphis Poplar (3)

Mabley Place Garage, LLC

Loan Balance as

Rate Maturity of 12/31/24

of 12/31/2023

322 Streeter Holdco, LLC 3.50 % 12/6/2024 $ — $ 24,672

American National Insurance Co.

MVP Houston Saks Garage, LLC

Barclays Bank PLC

4.25 % 8/6/2025 2,735 2,851

Minneapolis City Parking, LLC 4.50 % 5/1/2026 4,059 4,223

American National Insurance, of NY

MVP Bridgeport Fairfield Garage, LLC 4.00 % 8/1/2026 3,387 3,531

FBL Financial Group, Inc.

West 9th Properties II, LLC 4.50 % 11/1/2026 4,181 4,343

American National Insurance Co.

MVP Fort Worth Taylor, LLC 4.50 % 12/1/2026 10,408 10,807

American National Insurance, of NY

MVP Detroit Center Garage, LLC 5.52 % 2/1/2027 25,913 26,759

Bank of America

Paul Holiday Garage, LLC (1)

Louis Washington, LLC (1)

Cleveland Lincoln Garage, LLC (1)

MVP Denver Sherman, LLC (1)

MVP Milwaukee Arena Lot, LLC (1)

MVP Denver 1935 Sherman, LLC (1)

MVP Louisville Broadway Station, LLC (2)

Cantor Commercial Real Estate

MVP Whitefront Garage, LLC (2)

Cantor Commercial Real Estate

MVP Houston Preston Lot, LLC (2)

Cantor Commercial Real Estate

MVP Houston San Jacinto Lot, LLC (2)

Cantor Commercial Real Estate

Louis Broadway, LLC (2)

Cantor Commercial Real Estate

Louis Seventh & Cerre, LLC (2)

Cantor Commercial Real Estate

MVP Indianapolis Meridian Lot, LLC (2)

Cantor Commercial Real Estate

2027 KeyBank Loan Pool (1) 4.90 % 5/1/2027 11,094 11,415

2027 Canton Commercial Real Estate Loan Pool (2) 5.03 % 5/6/2027 16,250 16,249

St Louis Cardinal Lot DST, LLC 5.25 % 5/31/2027 6,000 6,000

Cantor Commercial Real Estate

MVP Preferred Parking, LLC 5.02 % 8/1/2027 10,789 11,028

Mabley Place Garage, LLC (5) 12/4/2027 12,000 7,428

2029 KeyBank Loan Pool (3) 7.94 % 3/1/2029 5,843 5,500

2034 CMBS Loan (4) 7.76 % 12/6/2034

Less unamortized loan issuance costs

We issued a promissory note to KeyBank for $ 12.7 million secured by the pool of properties.

We issued a promissory note to Cantor Commercial Real Estate Lending, L.P.

(“CCRE”) for $ 16.25 million secured by the pool of properties.

The loan is secured by a Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing on each of the properties owned by MVP St.

Louis 2013 and MVP Memphis Poplar.

* 2 Year Interest Only

** 10 Year Interest Only

I/O - Interest Only

In September 2023, we paid five notes in full with Vestin Realty Mortgage II, Inc.

in the amount of approximately $ 9.9 million.

( 2,238 ) ( 426 )

$ 185,921 $ 134,380

( 1 ) 2027 KeyBank Loan Pool is secured by the following properties:

Paul Holiday Garage, LLC, MVP St.

Louis Washington, Cleveland Lincoln Garage, LLC, MVP Denver Sherman, LLC, MVP Milwaukee Arena Lot, LLC and MVP Denver 1935 Sherman, LLC.

2027 Canton Commercial Real Estate Loan Pool is secured by the following properties:

MVP Louisville Broadway Station, LLC, MVP Whitefront Garage, LLC, MVP Houston Preston Lot, LLC, MVP Houston San Jacinto Lot, LLC, St.

Louis Broadway, LLC, St.

Louis Seventh & Cerre, LLC, MVP Indianapolis Meridian Lot, LLC and St.

Louis Cardinal Lot DST, LLC.

( 3 ) 2029 KeyBank Loan Pool is secured by MVP Memphis Poplar 2013, LLC and MVP St.

Louis 2013, LLC.

( 4 ) 2034 CMBS Loan is secured by the following properties:

1W7 Carpark, LLC, 222 W 7th Holdco, LLC, 222 Sheridan Bricktown Garage, LLC, 322 Streeter Holdco, LLC, Denver 1725 Champa Street Garage, LLC, MVP Hawaii Marks Garage, LLC and MVP Indianapolis City Park Garage, LLC.

( 5 ) As discussed below, the interest rate on the Mabley Place Garage, LLC loan is SOFR plus a spread of 3.25% until the interest rate swap agreement begins in March 2025 which will fix SOFR to a rate of 7.29%.

In February 2024, we refinanced the note payable for MVP St.

Louis 2013 and MVP Memphis Poplar with a ten year, $ 5.9 million note payable with an interest rate of 7.94 %.

Reserve funds are generally required for repairs and replacements, real estate taxes, and insurance premiums.

Louis 2013 and MVP Memphis Poplar with a five year, $ 5.9 million note payable with an interest rate of 7.94 %.

In December 2024, we refinanced the note payable for Mabley Place Garage, LLC with a three -year, $ 12.0 million note payable with an interest rate of SOFR plus a spread of 3.25 %.

In December 2024, we entered into a 10 -year, $ 75.5 million CMBS financing with Argentic Real Estate Finance 2 LLC (the "2034 CMBS Loan").

The 2034 CMBS Loan bears a fixed annual interest rate of 7.755 % and is secured by a pool of seven properties.

Proceeds of the 2034 CMBS Loan were used to repay and discharge the Revolving Credit Facility, as defined below, and refinance the note payable for 322 Streeter Holdco LLC.

The Loan agreement contains customary covenants and reserve requirements.

The Operating Company serves as a non-recourse guarantor and is required to maintain a net worth in excess of $ 40.0 million.

The fees associated with entering into the 2034 CMBS Loan of approximately $ 1.5 million are being amortized over the term of the loan to Interest Expense on the Consolidated Statement of Operations.

For many of our loan agreements, reserve funds are required for repairs and replacements, real estate taxes, and insurance premiums.

Some notes contain various terms and conditions including debt service coverage ratios and debt yield limits.

As of December 31, 2023, borrowers for two of the Company’s loans totaling $ 38.2 million, failed to meet certain loan covenants.

As of December 31, 2024 , borrowers for one of the Company’s loans totaling $ 25.9 million, failed to meet certain loan covenants.

As a result, we are subject to additional cash management procedures, which resulted in approximately $ 0.9 million of restricted cash as of December 31, 2024 .

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As of December 31, 2024 , future principal payments on notes payable are as follows (dollars in thousands):

Note G — Revolving Credit Facility and Interest Rate Cap

Revolving Credit Facility

In March 2022, we entered into a Credit Agreement (the “Credit Agreement”) with KeyBank Capital Markets, as lead arranger, and KeyBank, National Association, as administrative agent.

The Credit Agreement refinanced our then-current loan agreements for certain properties.

The Credit Agreement provided for, among other things, a $ 75.0 million revolving credit facility, originally maturing on April 1, 2023 ( the “Revolving Credit Facility”).

Borrowings under the Revolving Credit Facility bear interest at a Secured Overnight Financing Rate (“SOFR”) benchmark rate or Alternate Base Rate, plus a margin of between 1.75 % and 3.00 %, with respect to SOFR loans, or 0.75 % to 2.00 %, with respect to base rate loans, based on our leverage ratio as calculated under the Credit Agreement.

The Credit Agreement is secured by a pool of properties and requires compliance with certain financial covenants.

The Credit Agreement also included financial covenants that required us to (i) maintain a total leverage ratio not to exceed 65.0 %, (ii) not to exceed certain fixed charge coverage ratios, and (iii) maintain a certain tangible net worth.

During 2022, we drew $ 73.7 million on the Revolving Credit Facility to pay-off certain mortgage loans and fund an acquisition of a single garage.

In November 2022, we executed an amendment to the Credit Agreement which extended the maturity of the Revolving Credit Facility to April 1, 2024, amended certain financial covenants through the new term, and added a requirement for us to use diligent efforts to pursue an equity raise or liquidity event by March 31, 2023.

On the Closing Date, we entered into a second amendment to the Credit Agreement which reduced the total commitment from $ 75 million to $ 58.7 million, required us to remit $ 15 million of the proceeds from the Preferred PIPE Investment to pay down outstanding borrowings under the Credit Agreement, removed the fixed charge coverage ratio, required a borrowing base interest coverage ratio, required us maintain at least $ 7 million in unencumbered cash and cash equivalents, required contribution of certain real property as collateral, increased the debt pool yield, and established a reserve for certain cash collateral to be used for interest payments.

Concurrent with the paydown of $ 15 million, $ 0.1 million of unamortized loan fees were written off to Interest Expense in the Consolidated Statements of Operations.

As of December 31, 2023, the balance of unamortized loan fees associated with the Revolving Credit Facility is $ 0.2 million which is being amortized to Interest Expense, Net in the Consolidated Statements of Operations over the remaining term.

In March 2024, we executed the Third Amendment to the Credit Agreement, which provided extension options through June 2025 with increased interest rate spreads above SOFR at each extension.

We executed one of these options, which extends the maturity through October 2024.

Exercising an option following that maturity date would result in an interest rate spread above SOFR of 3.5 %.

Interest Rate Cap

In August 2023, we entered into an interest rate cap agreement with KeyBank with an initial value of approximately $ 0.2 million and a maturity on April 1, 2024.

The arrangement was for a notional amount of $ 58.7 million and limited the SOFR to a rate of 4.90 %.

On the Closing Date, we amended to our Revolving Credit Facility to reduce our total commitment from $ 75 million to $ 58.7 million and remitted $ 15 million of the proceeds from the Merger to pay down our principal.

In March 2024, we executed an amendment to provide extension options through June 2025 with increased interest rate spreads above SOFR at each extension.

In April 2024, we executed the first extension option, which extended the maturity through October 2024.

In October 2024, we executed the second extension option which extended the maturity through April 1, 2025 with an interest rate spread above SOFR of 3.5 %.

In September 2024, we fixed our all-in rate on our Revolving Credit Facility at 8.2 %.

Upon closing of the Line of Credit, as defined below, we remitted $ 5.0 million of the proceeds to pay down outstanding borrowings under the Credit Agreement.

Upon closing of the 2034 CMBS Loan, the outstanding borrowings under the Credit Agreement of approximately $ 48.8 million were paid in full.

Line of Credit

In September 2024, we entered into a $ 40.4 million revolving credit facility agreement with Harvest Small Cap Partners, L.P.

and Harvest Small Cap Partners Master, Ltd.

(collectively, the “Lenders”) maturing in September 2025 (the “Line of Credit”).

Borrowings under the Line of Credit will accrue interest at a rate of 15.0 % per annum, with interest payable in arrears at maturity or upon repayment of any principal amount borrowed under the Line of Credit.

The proceeds from the Line of Credit (after payment of related legal fees) are only to be used for redemption payments on the Series A Preferred Stock and Series 1 Preferred Stock, payment of dividends on the Series A Preferred Stock and Series 1 Preferred Stock accrued prior to the closing date of the Line of Credit, funding of the share repurchase program, discussed below, and a $ 5.0 million paydown on the Revolving Credit Facility, as noted above.

The Line of Credit includes provisions for defaults on certain indebtedness exceeding $ 25 million.

Osher, co-chair of the Company’s board of directors, is the managing member of No Street Capital LLC, which serves as the investment manager of the Lenders.

Upon drawing the first $ 15.0 million under the Line of Credit on the closing date, we issued 500,000 shares of common stock to the Lenders subject to a 180 -day lock period commencing on the date of issuance.

The issuance date fair value of the shares of approximately $ 1.8 million is considered a debt issuance cost and recorded in Other Assets on our Consolidated Balance Sheet and amortized over the one -year term to Interest Expense on the Consolidated Statement of Operations.

Unamortized loan fees as of December 31, 2024 were approximately $ 1.2 million.

As of December 31 2024, approximately $ 27.2 million was outstanding under the Line of Credit.

As of February 28, 2025, the outstanding balance increased to approximately $ 27.9 million.

Interest Rate Swap

In December 2024, we entered an interest rate swap agreement to coincide with the refinance of Mabley Place Garage, LLC, which will mature in December 2027, the value of which was immaterial as of December 31, 2024.

The arrangement was for a notional amount of $ 12.0 million and fixed SOFR to a rate of 7.29 % beginning in March 2025.

Our use of derivative instruments is limited to this interest rate cap to manage interest rate exposure.

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We have elected not to use hedge accounting due to the short-term duration of the arrangement and, as such, will reflect changes in fair value of the arrangement within our Consolidated Statements of Operations.

The change in the fair value of the interest rate cap from inception through December 31, 2023 was $ 0.2 million and recorded as Other Income, Net on the Statement of Operations.

Note H — Leases

All of our leases are classified as operating leases.

The following table summarizes the components of operating lease revenue recognized during the years ended December 31, 2023 and 2022 included within the Consolidated Statements of Operations (dollars in thousands):

Year Ended December 31,

Lease revenue

Fixed contractual payments

$ 7,103 $ 7,107

Variable lease payments

$ 23,100 $ 21,542

Straight-line rental income

Future fixed contractual lease payments to be received under non-cancelable operating leases in effect as of December 31, 2023 , assuming no new or renegotiated leases or option extensions on lease agreements are executed, are as follows (excluding leases subsequently replaced by asset management contracts, dollars in thousands):

Years Ending December 31,

Future lease payments due

Note I – Equity

Note 8 – Equity

Prior to the Merger, Legacy MIC had two classes of capital stock outstanding:

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By virtue of the consummation of the Merger, the Sponsor owns 1,900,000 Earn-Out Shares subject to vesting restrictions and forfeiture under the terms of the Sponsor Agreement, as follows:

(a) 950,000 Earnout Shares will vest at such time as the aggregate volume-weighted average price per share of our common stock for any 5 -consecutive trading day period after the Closing Date equals or exceeds $ 13.00 per share (provided that such shares will be cancelled if not vested prior to December 31, 2026) and (b) 950,000 Earn-out Shares will vest at such time as the aggregate volume-weighted average price per share of our common stock for any 5 -consecutive trading day period after the Closing Date equals or exceeds $ 16.00 per share (provided that such shares will be cancelled if they have not vested prior to December 31, 2028).

(a) 950,000 Earn-Out Shares will vest at such time as the aggregate volume-weighted average price per share of our common stock for any 5 -consecutive trading day period after the Closing Date equals or exceeds $ 13.00 per share (provided that such shares will be cancelled if not vested prior to December 31, 2026) and (b) 950,000 Earn-Out Shares will vest at such time as the aggregate volume-weighted average price per share of our common stock for any 5 -consecutive trading day period after the Closing Date equals or exceeds $ 16.00 per share (provided that such shares will be cancelled if they have not vested prior to December 31, 2028).

The Earn-Out Shares are classified as a liability on the Consolidated Balance Sheet, as certain settlement provisions within the agreement can affect the settlement value of the shares.

As described in Note A above, each issued and outstanding share of Legacy MIC Series 1 Preferred Stock and Legacy MIC Series A Preferred Stock converted into the right to receive one share of Series 1 Preferred Stock or one share of Series A Preferred Stock, as applicable, having terms materially the same as the applicable Legacy MIC Preferred Stock, except that the shares of Series 1 Preferred Stock and Series A Preferred Stock will be convertible into shares of our common stock instead of shares of Legacy MIC common stock.

Series A Convertible Redeemable Preferred Stock

The terms of the Series A Preferred Stock provide that the holders of the Series A Preferred Stock are entitled to receive, when and as authorized by the Board and declared by us out of legally available funds, cumulative cash dividends on each share at an annual rate of 7.50 % of the stated value pari passu with the dividend preference of the Series 1 Preferred Stock and in preference to any payment of any dividend on our common stock until the occurrence of a Listing Event, at which time, the annual dividend rate was reduced to 5.75% on the stated value of the Series A Preferred Stock.

The closing of the Merger and the listing of our common stock on the NYSE American constituted a Listing Event under the terms of the Series A Preferred Stock.

In March 2020, the Board unanimously authorized the suspension of the payment of distributions on the Series A Preferred Stock;

however, such distributions will continue to accrue in accordance with the terms of the Series A Preferred Stock.

Since initial issuance, we had declared distributions of approximately $ 1.4 million of which approximately $ 0.6 million had been paid to Series A stockholders.

As of December 31, 2023 and 2022, approximat ely $ 0.8 m illion and $ 0.6 million of Series A Preferred Stock distributions that were accrued and unpaid, respectively, are included in Accrued Preferred Distributions on the Consolidated Balance Sheet.

Subject to our redemption rights, each share of Series A Preferred Stock is convertible into common stock at the election of the holder thereof by delivery of a written notice, containing the information required by our charter, by a holder of shares of Series A Preferred Stock electing to convert such shares into common stock (the “Series A Preferred Stock Conversion Notice”), containing the information required by the charter, at any time.

Subject to our redemption rights, the conversion of Series A Preferred Stock into common stock will occur at the end of the 20th trading day after our receipt of such Series A Preferred Stock Conversion Notice.

Each share of Series A Preferred Stock will convert into a number of shares of common stock determined by dividing the sum of (i) 100% of the Series A Preferred Stock stated value, which is $1,000, plus (ii) any accrued but unpaid dividends to, but not including, the date of conversion by the volume weighted average price per share of common stock for the 20 trading days prior to the delivery date of the Series A Preferred Stock Conversion Notice.

As of December 31, 2023, approximately 50 shares of Series A Preferred Stock have been converted to approximately 14,000 shares of common stock.

The terms of the Series A Preferred Stock provide that the holders of the Series A Preferred Stock are entitled to receive, when and as authorized by the Board and declared by us out of legally available funds, cumulative cash dividends on each share at an annual rate of 5.75 % of the stated value pari passu with the dividend preference of the Series 1 Preferred Stock and in preference to any payment of any dividend on our common.

Series 1 Convertible Redeemable Preferred Stock

The terms of the Series 1 Preferred Stock provide that the holders of the Series 1 Preferred Stock are entitled to receive, when and as authorized by the Board and declared by us out of legally available funds, cumulative cash dividends on each share at an annual rate of 7.00 % of the stated value pari passu with the dividend preference of the Series A Preferred Stock and in preference to any payment of any dividend on our common stock until the occurrence of a Listing Event, at which time, the annual dividend rate was reduced to 5.50 % on the stated value of the Series 1 Preferred Stock.

The closing of the Merger and the listing of our common stock on the NYSE American constituted a Listing Event under the terms of the Series 1 Preferred Stock.

On March 24, 2020, the Board unanimously authorized the suspension of the payment of distributions on the Series 1 Preferred Stock, however, such distributions will continue to accrue in accordance with the terms of the Series 1 Preferred Stock.

Since initial issuance, the Company had declared distributions of approximately $ 16.1 million of which approximately $ 6.4 million had been paid to Series 1 Preferred Stock stockholders.

As of December 31, 2023 and 2022, approximately $ 9.7 m illion and $ 7.9 million of Series 1 Preferred Stock distributions that were accrued and unpaid, respectively, are included in Accrued Preferred Distributions on the consolidated balance sheet.

Subject to our redemption rights, each share of Series 1 Preferred Stock is convertible into common stock at the election of the holder thereof by delivery of a written notice, containing the information required by our charter, by a holder of shares of Series 1 Preferred Stock electing to convert such shares into common stock (the “Series 1 Preferred Stock Conversion Notice”), containing the information required by the charter, at any time.

Subject to our redemption rights, the conversion of Series 1 Preferred Stock into common stock will occur at the end of the 20th trading day after our receipt of such Series 1 Preferred Stock Conversion Notice.

Each share of Series 1 Preferred Stock will convert into a number of shares of common stock determined by dividing the sum of (i) 100% of the Series 1 Preferred Stock stated value, which is $1,000, plus (ii) any accrued but unpaid dividends to, but not including, the date of conversion by the volume weighted average price per share of common stock for the 20 trading days prior to the delivery date of the Series 1 Preferred Stock Conversion Notice.

As of December 31, 2023, approximately 3,100 shares of Series 1 Preferred Stock have been converted to approximately 1.0 million shares of common stock.

The terms of the Series 1 Preferred Stock provide that the holders of the Series 1 Preferred Stock are entitled to receive, when and as authorized by the Board and declared by us out of legally available funds, cumulative cash dividends on each share at an annual rate of 5.5 % of the stated value pari passu with the dividend preference of the Series A Preferred Stock and in preference to any payment of any dividend on our common..

Series 1 Preferred Stock and Series A Preferred Stock Distributions

In March 2020, we began accruing distributions on the Series 1 Preferred Stock and Series A Preferred Stock after the Legacy MIC Board unanimously authorized the suspension of the payment of distributions.

On September 11, 2024, the Board declared payment of accrued and unpaid dividends for all past dividend periods on the Series 1 Preferred Stock at a rate of $ 299.84 per share and on the Series A Preferred Stock at a rate of $ 319.81 per share to holders of record as of close of business on September 10, 2024.

Additionally, we declared monthly dividend payments on the Series A Preferred Stock and Series 1 Preferred Stock at a rate of $ 4.583 and $ 4.791 per share, respectively, for each subsequent month in 2024.

The payment of future dividends is subject to the Board’s discretion and will be determined by the Board based on the Company’s financial condition, applicable law and such other considerations as the Board deems relevant.

Series 1 Preferred Stock and Series A Preferred Stock Redemptions and Conversions

Upon receipt of written notice to convert shares of Series 1 Preferred Stock and Series A Preferred Stock into common stock, we have the option to redeem the shares for cash with the redemption price equal to the stated value of $1,000, plus any accrued but unpaid dividends.

Should we elect to convert the shares, each share of Series 1 Preferred Stock and Series A Preferred Stock will convert into a number of shares of common stock determined by dividing the sum of (i) 100% of the stated value of $1,000, plus (ii) any accrued but unpaid dividends up to, but not including, the date of conversion, by the volume weighted average price per share of common stock for the 20 trading days prior to the delivery date of the receipt of the notice.

During the year ended December 31, 2024 , approximately 8,000 shares of Series 1 Preferred Stock and approximately 600 shares of Series A Preferred Stock converted to approximately 2.8 million and 193,000 shares of common stock, respectively.

Approximately 10,600 shares of the Series 1 Preferred Stock and approximately 300 shares of Series A Preferred Stock were redeemed for cash during the year ended December 31, 2024 .

In addition, requested redemptions at December 31, 2024 of approximately 500 shares with a stated value of approximately $ 0.5 million of Series 1 Preferred Stock and Series A Preferred Stock were reclassified to Accrued Preferred Distributions and Redemptions on the Consolidated Balance Sheet, as we intend to redeem the shares for cash.

During the year ended December 31, 2023, approximately 3,100 shares of Series 1 Preferred Stock and approximately 50 shares of Series A Preferred Stock converted to approximately 1.0 million and 14,000 shares of common stock, respectively.

No shares of Series 1 Preferred Stock or Series A Preferred Stock were redeemed for cash during the year ended December 31, 2023.

Series 2 Convertible Preferred Stock

On June 15, 2023, the Preferred PIPE Investors each entered into a Preferred Subscription Agreement with FWAC pursuant to which, among other things, the Preferred PIPE Investors agreed to subscribe for and purchase, and FWAC agreed to issue and sell to the Preferred PIPE Investors, a total of 46,000 shares of Series 2 Preferred Stock at $ 1,000 per share for an aggregate purchase price of $ 46,000,000 , on the terms and subject to the conditions set forth therein.

On June 15, 2023, the Preferred PIPE Investors each entered into a Preferred Subscription Agreement with FWAC pursuant to which, among other things, the Preferred PIPE Investors agreed to subscribe for and purchase a total of 46,000 shares of Series 2 Preferred Stock at $ 1,000 per share for an aggregate purchase price of $ 46,000,000 .

The Series 2 Preferred Stock was entitled to receive dividends at a cumulative annual rate of 10 % during the period between the initial issuance of such shares and the conversion thereof into shares of our common stock.

provided that if the date of distribution occurs prior to the first anniversary of the original date of issuance of such share, the holder of such share of Series 2 Preferred Stock shall receive dividends at a cumulative annual rate of 10 % of the $ 1,000.00 per share liquidation preference for a period of one year, and will be paid in full on the conversion date.

Dividends were to be paid in kind and also convert into shares of our common stock on the earlier of (a) a change of control of MIC and (b) December 31, 2023.

The Series 2 Preferred Stock converted at a conversion price of $ 3.67 per share of common stock, subject to appropriate adjustment in relation to certain events, such as recapitalizations, stock dividends, stock splits, stock combinations, reclassifications or similar events affecting the Series 2 Preferred Stock, as set forth in the Charter.

Accordingly, the aggregate of 46,000 shares of Series 2 Preferred Stock converted into a total of 13,787,462 shares of our common stock, which number is comprised of (i) 12,534,058 shares of our common stock issuable upon the conversion of 46,000 shares of Series 2 Preferred Stock based on the stated value of such shares and (ii) 1,253,404 shares of our common stock issuable upon the conversion of the dividends.

The Series 2 Preferred Stock converted at a conversion price of $ 3.67 per share of common stock.

Accordingly, the aggregate of 46,000 shares of Series 2 Preferred Stock converted into a total of 13,787,462 shares of our common stock, which is comprised of (i) 12,534,058 shares of our common stock issuable upon the conversion of 46,000 shares of Series 2 Preferred Stock based on the stated value and (ii) 1,253,404 shares of our common stock issuable upon the conversion of the dividends.

Because the terms and amount of the dividend are contractually agreed upon, at the time of the Merger we recorded the full $ 4.6 million value of the paid-in-kind dividend.

In accordance with its warrant agreement between Legacy MIC and Color Up, dated August 25, 2021 ( the “Warrant Agreement”), Color Up had the right to purchase up to 1,702,128 shares of common stock, at an exercise price of $ 11.75 per share for an aggregate cash purchase price of up to $ 20.0 million (the “Common Stock Warrants”).

Each whole Common Stock Warrant entitled the registered holder thereof to purchase one whole share of common stock at a price of $ 11.75 per share, subject to customary adjustments, at any time following a “Liquidity Event,” which was defined as an initial public offering and/or listing of the common stock on the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange.

As of the Closing Date, FWAC, Legacy MIC, and Color Up entered into a Warrant Assumption and Amendment Agreement (the “Warrant Assumption and Amendment Agreement”) to the Warrant Agreement, whereby the Company assumed the Common Stock Warrants remaining outstanding and unexpired at that time, and such Common Stock Warrants became the common stock warrants of the Company.

Subsequent to the Closing date, on August 29, 2023, New MIC and Color Up entered into an Amended and Restated Warrant Agreement (the “Amended Warrant Agreement”), pursuant to which the Warrant Agreement was amended and restated to (i) reflect the effects of the Merger (including but not limited to the reduction in the exercise price of the Common Stock Warrants from $ 11.75 to $ 7.83 per share and the increase in the number of the underlying shares from 1,702,128 shares of Legacy MIC common stock to 2,553,192 shares of our common stock) and (ii) permit Color Up to exercise the Common Stock Warrants on a cashless basis at Color Up’s option.

As of the Closing Date, FWAC, Legacy MIC, and Color Up amended the Warrant Agreement to assume the Common Stock Warrants remaining outstanding and unexpired at that time.

On August 29, 2023, New MIC and Color Up further amended the Warrant Agreement to (i) reflect the effects of the Merger (including but not limited to the reduction in the exercise price of the Common Stock Warrants from $ 11.75 to $ 7.83 per share and the increase in the number of the underlying shares from 1,702,128 shares of Legacy MIC common stock to 2,553,192 shares of our common stock) and (ii) permit Color Up to exercise the Common Stock Warrants on a cashless basis at Color Up’s option.

Subsequently, Color Up distributed the entirety of the Common Stock Warrants to HSCP Strategic III, LP, an entity controlled by Mr.

Osher, and Bombe Asset Management, LLC, an entity owned and controlled by Mr.

Chavez and Ms.

The Common Stock Warrants expire on August 25, 2026 and are classified as equity and recorded at the issuance date fair value.

Securities Purchase Agreement

On November 2, 2021, Legacy MIC entered into a securities purchase agreement (the “Securities Purchase Agreement”) by and among the Company, the Operating Partnership, and HS3, pursuant to which the Operating Partnership issued and sold to HS3 (a) 1,702,128 newly issued OP Units;

In November 2021, Legacy MIC sold to HS3 (a) 1,702,128 newly issued OP Units;

and (b) 425,532 newly-issued Class A units of limited partnership of the Operating Partnership (“Class A Units”) which entitle HS3 to purchase up to 425,532 additional OP Units (the “Additional OP Units”) at an exercise price equal to $ 11.75 per Additional OP Unit, subject to adjustment as provided in the Class A Unit agreement, and HS3 paid to the Operating Partnership cash consideration of $ 20.0 million.

The Additional OP Units are available to be exercised only upon completion of a Liquidity Event, as defined in the Securities Purchase Agreement.

In connection with the Merger, the number of Class A Units was adjusted to 638,298 and the exercise price for the Class A Units was adjusted to $ 7.83 per Class A Unit.

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Convertible Noncontrolling Interests

As of December 31, 2023, the Operating Company had approximat ely 42 million Comm on Units outstanding, excluding any equity incentive units granted.

Beginning six months after first acquiring Common Units, each member will have the right to redeem the Common Units for either cash or common stock, subject to both the Company's discretion and the terms and conditions set forth in the limited liability company agreement of the Operating Company (the “Operating Agreement”).

As of December 31, 2024 , the Operating Company had approximately 44.9 million Common Units outstanding, excluding any equity incentive units granted.

Beginning six months after first acquiring Common Units, each member will have the right to redeem the Common Units for either cash or common stock, subject to both our discretion and the terms and conditions set forth in the limited liability company agreement of the Operating Company (the “Operating Agreement”).

During the year ended December 31, 2024 , approximately 9.4 million Common Units converted to shares of common stock on a one -for- one basis.

In connection with the refinancing of the the note payable for Mabley Place Garage, LLC, we purchased the minority interest ownership in the subsidiary for $ 1.5 million.

The Common Units not held by the Company outstanding as of December 31, 2024 are classified as noncontrolling interests within permanent equity on our Consolidated Balance Sheet.

Note J - Stock-Based Compensation

Share Repurchase Program

In September 2024, the Board authorized a share repurchase program of up to $ 10 million of shares of our outstanding common stock.

Repurchases may be made from time to time through open market purchases or through privately negotiated transactions subject to market conditions, applicable legal requirements and other relevant factors.

Open market repurchases may be structured to occur in accordance with the requirements of Rule 10b - 18 of the Securities Exchange Act of 1934, as amended.

We may also enter into Rule 10b5 - 1 plans to facilitate repurchases of our shares under this authorization.

During the year ended December 31, 2024 , we repurchased 419,188 shares under the program, for a cost of approximately $ 1.3 million.

As of February 28, 2025, approximately 55,000 additional shares were repurchased under the program for a cost of approximately $ 0.2 million.

Note 9 - Stock-Based Compensation

Long-Term Incentive Plan

We issue equity-based awards to promote the success and enhance the value of MIC and the Operating Company, by linking the individual interests of employees, consultants and members of the MIC Board to those of MIC’s stockholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to MIC’s stockholders.

We issue awards under our 2023 Incentive Award plan (the "Plan").The Plan provides for the grant of stock options, including incentive stock options (“ISOs”), and nonqualified stock options (“NSOs”), restricted shares, dividend equivalent awards, share payment awards, restricted share units (“RSUs”), performance awards, performance share awards, other incentive awards, profits interest units (including Performance Units and LTIP Units) and SARs.

Going forward, the Board intends to grant awards during the first quarter of each year.

We issue awards under our 2023 Incentive Award plan (the "Plan").

The Plan provides for the grant of stock options, including incentive stock options (“ISOs”), and nonqualified stock options (“NSOs”), restricted shares, dividend equivalent awards, share payment awards, restricted share units (“RSUs”), performance awards, performance share awards, other incentive awards, profits interest units (including Performance Units and LTIP Units) and SARs.

The Board typically grants awards during the first quarter of each year.

Service-based awards will typically follow a multi-year graded vesting schedule and will vest in the form of common stock or LTIP Units.

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Employee Awards

In 2024, the Compensation Committee of the Board of Directors approved the issuance of the following awards:

0.3 million LTIP units to Mr.

Chavez in lieu of his salary for 2021 and 2023 and for his 2023 short-term incentive award.

These awards were issued at a grant date fair value of $ 3.84 and vested upon issuance.

At the same time, 0.2 million LTIP units were granted in lieu of his 2024 salary, which vested in four equal increments each quarter over 2024.

0.4 million LTIP units and 0.2 million restricted stock units awarded at a grant date fair value of $ 3.84 to two of our executives representing the long term incentive awards for 2023 and 2024.

These awards will vest on a graded schedule over three years.

0.1 million LTIP Units and 0.1 million restricted stock units with a grant date fair value of $ 6.11 to three executives using the Monte Carlo method.

These awards will vest based upon the performance of our stock versus the Russell 2000 Index through January 2027.

Approximately 56,000 restricted stock units awarded to one executive at a grant date fair value of $ 3.60 that vest on graded schedule over three years.

Two tranches of 0.1 million restricted stock units that vest upon achievement of stock price performance goals (the “Founders’ Award”).

The fair value of both tranches was determined using the Monte Carlo method.

The first tranche of the awards, with a performance period through December 31, 2026, has an immaterial grant date fair value and the second tranche, with a performance period through December 31, 2028, has a grant date fair value of $ 0.60 per share.

Additionally, the Compensation Committee approved the modification of 2.3 million performance units previously granted to two executives to align the performance conditions and performance periods to the Founders’ Award and the Earn-Out Shares.

The incremental compensation expense of approximately $ 0.7 million will be recognized through the modified performance period of December 31, 2028 in General and Administrative on the Consolidated Statements of Operations.

In February 2023, we granted Mr.

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The grant date fair value was determined to be $ 8.99 per unit for each of the LTIP Units awarded.

In August 2022 we granted 0.4 million LTIP Units to our executives which would vest upon the completion of a Liquidity Event.

In December 2022, we amended the award to require a service condition for a period of one year from a Liquidity Event.

The modified grant date fair value of these LTIP Units was determined to be $ 15.00 per unit.

As a result of the Closing, these LTIP Units achieved their performance hurdle.

In September 2023, the Compensation Committee of the Board of Directors approved the cancellation of 0.1 million of these LTIP Units.

The expense associated with the cancellation of approximately $ 1.4 million is included in General and Administrative in the accompanying Consolidated Statements of Operations.

In September 2023, the Compensation Committee of the Board of Directors approved the cancellation of 0.1 million LTIP Units previously granted to our executives.

The expense associated with the cancellation of approximately $ 1.4 million is included in General and Administrative in the accompanying Consolidated Statements of Operations for the year ended December 31, 2023.

The cancellation was a result of a plan to reallocate the award shares to non-executive employees.

As a result, in December 2023, we granted 0.1 million restricted stock units to non-executive employees which will vest in August 2024.

The remaining value of the LTIP awards granted to the executives is being expensed over the one -year service period following the Closing.

In May 2022, we granted an aggregate of 2.3 million Performance Units of the Operating Partnership (“PUs”) to the executive officers of the Company.

The PUs vest upon the achievement of a 50 % market condition and a 50 % performance condition.

The performance period ends in December 2025 for the market condition and in December 2027 for the performance condition.

The grant date fair value of the PUs with market conditions was estimated at $ 5.97 per unit using a Monte Carlo simulation of future stock prices for us and our corresponding peer group.

The PUs subject to a performance conditions will vest if we achieve a hurdle related to our adjusted funds from operations per share for four consecutive quarters prior to the fourth quarter of 2025 and then for an additional four consecutive quarters prior to December 2027.

The PUs subject to a performance condition were deemed not probable of achievement as of December 31, 2023 or 2022, and therefore we did not record any charges related to the awards with a performance condition.

The probability of achievement of the performance condition will continue to be assessed throughout the performance period.

As a result, in December 2023, we granted 0.1 million restricted stock units to non-executive employees which vested in August 2024.

The remaining value of the LTIP awards granted to the executives was expensed over the one -year service period following the Closing.

Director Awards

We granted approximately 14,500 and 39,100 LTIP Units in 2022 and 2023, respectively to our independent directors in consideration for their accrued but unpaid director compensation fees from 2021 and 2022.

In January 2024, we granted 0.2 million restricted stock units to our independent directors as consideration for service in 2023 and 2024.

These awards have a grant date fair value of $ 3.84 and will vest on the one year anniversary of the grant date.

We granted approximately 39,100 LTIP Units in 2023 to our independent directors in consideration for their accrued but unpaid director compensation fees from 2022.

The LTIP Units will vest over a three -year period.

Prior to the granting of the Director LTIP Units, the associated compensation was anticipated to be paid in cash, and as such, the expense was accrued as a liability in the Consolidated Balance Sheets.

Upon vesting, the Director LTIP Units are redeemable in cash or shares, at the option of the holder.

As a result, the Director LTIP Units are classified as a liability within accounts payable and accrued expenses in the Consolidated Balance Sheet as of December 31, 2022.

As a result, the unvested Director LTIP Units are classified as a liability within accounts payable and accrued expenses in the Consolidated Balance Sheet as of December 31, 2024.

The following table sets forth a roll forward of all incentive equity awards for the years ended December 31, 2024 and 2023 :

Number of Incentive Equity Awards

Weighted-Average Grant Date Fair Value Per Share

Weighted-Average Grant Date FV Per Share

Nonvested - January 1, 2023

2,673,041 $ 8.44

( 59,681 ) 9.40

( 135,320 ) 10.00

Nonvested - January 1, 2024

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We recognized $ 5.7 million and $ 8.6 million of equity-based compensation expense for the years ended December 31, 2024 and 2023 , respectively, which is included in General and Administrative in the Consolidated Statements of Operations.

Included in the 2023 expense were equity awards granted in lieu of salary amounts as noted below.

The remaining unrecognized compensation cost of approximately $ 3.3 million, which excludes $ 11.6 million related to awards deemed not probable to achieve their performance target, will be recognized over a weighted average term of 1.2 years.

In January 2024, the Compensation Committee of the Board of Directors approved the issuance of the following awards:

0.3 million LTIP units to Mr.

Chavez in lieu of his salary for 2021 and 2023 and for his 2023 short-term incentive award.

These awards were issued at a grant date fair value of $ 3.84 and vested upon issuance.

At the same time, 0.2 million LTIP units were granted in lieu of his 2024 salary, which will vest in four equal increments each quarter over the next twelve months.

0.4 million LTIP units and 0.2 million restricted stock units awarded at a grant date fair value of $ 3.84 to our executives representing the long term incentive awards for 2023 and 2024.

These awards will vest on a graded schedule over three years.

0.1 million LTIP Units and 0.1 million restricted stock units with a grant date fair value of $ 6.11 to our executives using the Monte Carlo method.

These awards will vest based upon the performance of our stock versus the Russell 2000 Index three years from the grant date.

0.2 million restricted stock units awarded to the independent directors as consideration for service in 2023 and 2024.

These awards have a grant date fair value of $ 3.84 and will vest twelve months on the one year anniversary of the grant date.

Note K — Employee Benefit Plan

Included in the 2024 and 2023 expense were equity awards granted in lieu of salary amounts as noted above.

The remaining unrecognized compensation cost of approximately $ 3.0 million will be recognized over a weighted average term of 2.1 years.

Performance based awards are valued at target and may have the ability to earn additional or fewer shares based on level of achievement.

Note 10 — Employee Benefit Plan

We sponsor a 401 (k) plan that provides benefits for qualified employees.

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Total expense recorded for the matching 401 (k) contribution in the years ended December 31, 2024 and 2023 , was approximately $ 140,000 and $ 109,000 , respectively.

Note L – Earnings Per Share

Basic and diluted loss per weighted average common share (“EPS”) is calculated by dividing net income (loss) attributable to the our common stockholders, including any participating securities, by the weighted average number of shares outstanding for the period.

Note 11 – Earnings Per Share

Basic and diluted loss per weighted average common share (“EPS”) is calculated by dividing net income (loss) attributable to our common stockholders, including any participating securities, by the weighted average number of shares outstanding for the period.

We include the effect of participating securities in basic and diluted earnings per share computations using the two -class method of allocating distributed and undistributed earnings when the two -class method is more dilutive than the treasury stock method.

Outstanding warrants and stock-based compensation were antidilutive as a result of the net loss for the twelve months ended December 31, 2023 and 2022 and therefore were excluded from the dilutive calculation.

We include unvested PUs as contingently issuable shares in the computation of diluted EPS once the market criteria is met, assuming that the end of the reporting period is the end of the contingency period.

We had 2.8 million un vested service-and performance-based awards which are considered antidilutive to the dilutive loss per share calculation for the twelve months ended December 31, 2023 and 2022.

The following table reconciles the numerator and denominator used in computing our basic and diluted per-share amounts for net loss attributable to common stockholders for the twelve months ended December 31, 2023 and 2022 (dollars in thousands):

Outstanding warrants and stock-based compensation were antidilutive as a result of the net loss for the years ended December 31, 2024 and 2023 and therefore were excluded from the dilutive calculation.

We include unvested performance units as contingently issuable shares in the computation of diluted EPS once the market criteria is met, assuming that the end of the reporting period is the end of the contingency period.

We had 3.6 and 2.8 million un vested service-and performance-based awards which are considered antidilutive to the dilutive loss per share calculation for the years ended December 31, 2024 and 2023 .

The following table reconciles the numerator and denominator used in computing our basic and diluted per-share amounts for net loss attributable to common stockholders for the years ended December 31, 2024 and 2023 (dollars in thousands):

Net loss attributable to MIC

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$ ( 0.24 ) $ ( 2.45 )

Note M – Variable Interest Entities

Note 12 — Leases

All of our leases are classified as operating leases.

The following table summarizes the components of operating lease revenue recognized during the years ended December 31, 2024 and 2023 included within the Consolidated Statements of Operations (dollars in thousands):

Year Ended December 31,

Lease revenue

Fixed contractual payments

$ 5,782 $ 7,103

Variable lease payments

$ 3,332 $ 23,100

Straight-line rental income

Future fixed contractual lease payments to be received under non-cancelable operating leases in effect as of December 31, 2024 , assuming no new or renegotiated leases or option extensions on lease agreements are executed, are as follows (excluding leases subsequently replaced by asset management contracts, dollars in thousands):

Years Ending December 31,

Future lease payments due

Lessee - Right of Use Asset and Lease Liability

We are the lessee in a ground lease for additional space at

one location with a commencement date of

January 1, 2024.

The lease has a

fourteen -year term, including extension options, with an annual payment of

$ 40,457 per annum for the

first year and increased each year by the lesser of

3.5 % and the Consumer Price Index.

The lease is accounted for as an operating lease under ASU

02, Leases – (Topic

We recognized a Right of Use (“ROU”) Leased Asset and a ROU Lease Liability on the lease commencement date which is included in Land and Improvements and Accounts Payable and Accrued Expenses , respectively, on the Consolidated Balance Sheets.

Through the discounting of the remaining lease payments at our incremental borrowing rate of

8.42 %, the value of both the ROU asset and ROU liability recognized at commencement date was approximately

$ 0.3 million.

We recognized approximately

$ 40,000 of operating lease expense during the year ended

This expense is included in Property Operating Expense on the Consolidated Statements of Operations.

Changes in the lease liability and lease asset amortization expense were

not material in the Statement of Cash Flows.

As of December 31, 2024, future lease payments are as follows (dollars in thousands):

As of December 31, 2024

Total lease payments

Less amount representing interest

Note 13 – Variable Interest Entities

We, through a wholly owned subsidiary of the Operating Company, own a 51.0 % beneficial interest in MVP St.

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Louis is the owner of a 2.56 -acre, 376 -vehicle commercial parking lot, known as the Cardinal Lot.

Louis is considered VIE and we conclude that it is the primary beneficiary since the power to direct the activities that most significantly impact the economic performance of MVP St.

Louis is considered VIE and we conclude that we are the primary beneficiary since the power to direct the activities that most significantly impact the economic performance of MVP St.

Louis was held by MVP Parking DST, LLC (the “Manager”) and certain subsidiaries of the Manager, which is controlled by Mr.

As a result, we consolidate its investment in MVP St.

As a result, we consolidate our investment in MVP St.

Louis and MVP St.

Louis Cardinal Lot Master Tenant, LLC, which had total assets of approximatel y $ 13.0 and $ 12.6 million (substantially all real estate investments) and liabilities of approximately $ 6.6 and $ 6.2 m illion (substantially all mortgage debt) as of December 31, 2023 and 2022, respectively.

Note N — Income Taxes

The Company previously elected to be taxed as a REIT for federal income tax purposes and operated in a manner that allowed the Company to qualify as a REIT through December 31, 2019.

As a consequence of the COVID- 19 pandemic, the Company earned management income in lieu of lease income from a number of distressed tenants, which did not constitute qualifying REIT income for purposes of the annual REIT gross income tests, and, as a result, the Company was not in compliance with the annual REIT income tests for the year ended December 31, 2020.

Accordingly, the Company did not qualify for taxation as a REIT in 2020 and continues to be taxed as a C corporation.

As a C corporation, the Company is subject to federal income tax on its taxable income at regular corporate rates.

A full valuation allowance for deferred tax assets was historically provided each year since the Company believed that as a REIT it was more likely than not that it would not realize the benefits of its deferred tax assets.

As a taxable C Corporation, the Company has evaluated its deferred tax assets for the year ended December 31, 2023, which consist primarily of net operating losses and its investment in the Operating Partnership.

Louis Cardinal Lot Master Tenant, LLC, which had total assets of approximately $ 11.9 and $ 13.0 million (substantially all real estate investments) and liabilities of approximately $ 6.0 and $ 6.6 million (substantially all mortgage debt) before consolidation as of December 31, 2024 and 2023, respectively.

Note 14 — Income Taxes

Legacy MIC previously elected to be taxed as a REIT for federal income tax purposes and operated in a manner that allowed Legacy MIC to qualify as a REIT through December 31, 2019.

As a consequence of the COVID- 19 pandemic, Legacy MIC earned management income in lieu of lease income from a number of distressed tenants, which did not constitute qualifying REIT income for purposes of the annual REIT gross income tests, and, as a result, was not in compliance with the annual REIT income tests for the year ended December 31, 2020.

Accordingly, Legacy MIC did not qualify for taxation as a REIT in 2020.

We continue to be taxed as a C corporation and are subject to federal income tax on our taxable income at regular corporate rates.

A full valuation allowance for deferred tax assets was historically provided each year as it was more likely than not that the Company would not realize the benefits of its deferred tax assets.

As a taxable C Corporation, we have evaluated our deferred tax assets for the year ended December 31, 2024 , which consist primarily of net operating losses and our investment in the Operating Partnership.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets.

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Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth.

Despite substantial growth in property-level operations, the Company has continued to generate a net loss and as such the Company has determined that it will continue to record a full valuation allowance against its deferred tax assets for the year ended December 31, 2023.

A change in circumstances may cause the Company to change its judgment about whether deferred tax assets should be recorded, and further whether any such assets would more likely than not be realized.

The Company would generally report any change in the valuation allowance through its Consolidated Statements of Operations in the period in which such changes in circumstances occur.

Despite substantial growth in property-level operations, we have continued to generate a net loss and as such we have determined that we will continue to record a full valuation allowance against our deferred tax assets for the year ended December 31, 2024 .

A change in circumstances may cause us to change our judgment about whether deferred tax assets should be recorded, and further whether any such assets would more likely than not be realized.

We would generally report any change in the valuation allowance through our Consolidated Statements of Operations in the period in which such changes in circumstances occur.

The provision for income taxes for the years ended December 31, 2024 and 2023 consisted of the following, which is included in general and administrative expense in the Consolidated Statements of Operations (dollars in thousands):

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The following table presents a reconciliation of the statutory corporate U.S.

federal income tax rate to the Company’s effective tax rate as of December 31, 2023 :

federal income tax rate to our effective tax rate as of December 31, 2024 :

statutory rate

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Deferred Tax Liabilities:

Straight-line Rent

Total net deferred taxes

As of December 31, 2023, the Company had federal and various state net operating loss (NOL) carryforwards of $ 73.8 million and $ 44.1 million, respectively.

As of December 31, 2024 and 2023.

we had federal and various state net operating loss (NOL) carryforwards of $ 95.8 million and $ 73.8 million, respectively.

The federal net operating losses generated in 2018 and after of $ 87.2 million will carryforward indefinitely and be available to offset up to 80% of future taxable income each year.

The federal net operating losses generated prior to 2018 of $ 8.6 million will begin to expire in 2036 unless previously utilized.

Note O — Fair Value

Note 15 — Fair Value

A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability in an orderly transaction.

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In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Our financial instruments include cash and cash equivalents, restricted cash, accounts receivable and accounts payable.

Due to their short maturities, the carrying amounts of these assets and liabilities approximate fair value.

The estimated fair value of our debt (including notes payable and the Revolving Credit Facility) was derived using Level 2 inputs and approxim ates $ 182.9 million and $ 207.4 million as of December 31, 2023 and 2022, respectively.

Our financial instruments include cash and cash equivalents, restricted cash, accounts receivable, notes receivable and accounts payable.

Due to their short maturities or recent nature, the carrying amounts of these assets and liabilities approximate fair value.

The estimated fair value of our notes payable, including the Revolving Credit Facility in 2023, were derived using Level 2 inputs and approxim ates $ 186.7 million and $ 182.9 million as of December 31, 2024 and 2023 , respectively.

The carrying amount of the Line of Credit as of December 31, 2024 approximates fair value due to its recent nature.

Recurring and Nonrecurring Fair Value Measurements

Our Earn-Out Shares and interest rate cap are measured and recognized at fair value on a recurring basis, while certain real estate assets and liabilities are measured and recognized at fair value as needed.

Fair value measurements that occurred as of and during the year ended December 31, 2023 and 2022, were as follows (in thousands):

Fair value measurements that occurred as of and during the years ended December 31, 2024 and 2023 , were as follows (in thousands):

December 31, 2024

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Interest rate cap

— — — — $ 54 —

Impaired real estate assets

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These estimates require us to make various assumptions about the risk-free rate, expected volatility for each tranche of the Earn-Out Shares, and other items that are unobservable and are considered Level 3 inputs in the fair value hierarchy.

Because we are a newly-listed company with limited share activity, we were required to exercise judgment in estimating expected volatility ( 30.0 % to 45.0 %) and in selection of comparable companies.

We recognized a gain of approxim ately $ 4.1 million during the year ended December 31, 2023 a s a result of changes in the estimated fair values after the Merger.

Because we are a newly-listed company with limited share activity, we were required to exercise judgment in estimating expected volatility (currently 35.0 % to 40.0 %) and in selection of comparable companies.

We recognized a gain of approxim ately $ 0.8 million and $ 4.1 million during the years ended December 31, 2024 and December 31, 2023, respectively, a s a result of changes in the estimated fair values after the Merger.

The gain is recorded as the Change in Fair Value of Earn-out Liability in the Consolidated Statements of Operations.

The following table reflects the change in value during the year ended December 31, 2023 (in thousands):

The following table reflects the change in value during the years ended December 31, 2024 and 2023 (in thousands):

Level 3 Liability

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Balance as of December 31, 2023

Interest Rate Cap

Our interest rate cap is measured at fair value on a recurring basis.

The valuation is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative.

This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities.

The fair value of the interest rate cap is determined using the market standard methodology of valuing the expected discounted future fixed cash receipts.

The variable cash or receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

We evaluated the need for credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements, but believe these impacts are not material.

Because we determined that the significant inputs used to value our derivatives are observable, we believe our derivative valuation is classified in Level 2 of the fair value hierarchy.

Change in fair value recognized in earnings

Balance as of December 31, 2024

Our real estate assets are measured and recognized at fair value on a nonrecurring basis when we determine an impairment has occurred.

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We utilize market data such as sales price per stall on comparable recent real estate transactions to estimate the fair value of the real estate assets.

We also utilize expected net sales proceeds to estimate the fair value of any centers that are actively being marketed for sale.

We also utilize expected net sales proceeds to estimate the fair value of any properties that are actively being marketed for sale.

Because we use estimates and assumptions regarding an assets’ future performance and cash flows as well as market conditions and discount rates, we determined the impaired assets would fall under Level 3 of the fair value hierarchy.

During the year ended December 31, 2024, we impaired approximately $ 0.2 million of our real estate assets as a result of a planned disposition of a property.

During the year ended December 31, 2023, we impaired approximately $ 9.0 million of our real estate assets as a result of continuing delayed back-to-work trends or other reductions of demand-drivers impacting these assets, as well as disposition of properties.

Note P — Commitments and Contingencies

Note 16 — Commitments and Contingencies

The nature of our business exposes our properties, the Company, the Operating Company and our other subsidiaries to the risk of claims and litigation in the normal course of business.

Other than as noted below, or routine litigation arising out of the ordinary course of business, we are not presently subject to any material litigation nor, to our knowledge, is any material litigation threatened against us.

In March 2023, Michael Shustek filed a complaint against Legacy MIC in the U.S.

District Court, District of Maryland (the “Court”), seeking advancement of indemnification expenses related to the SEC investigation against Mr.

Shustek, alleging damages (case 1:23 -CV- 00599 ).

On September 6, 2023, the parties entered into a settlement agreement (the "Settlement Agreement"), and in September 2023, the Court ordered the case closed.

As a result of the Settlement Agreement, we recognized a gain of approximately $ 1.2 million which is recorded as Other Income, Net in the Consolidated Statements of Operations.

In August 2021, we also entered into an Assignment of Claims, Causes of Action, and Proceeds Agreement, or the Assignment of Litigation Agreement, pursuant to which we assigned to Vestin Realty Mortgage II, Inc.

and Michael V.

Shustek certain claims and claim proceeds that we had against Ira S.

Levine, Levine Law Group, Inc.

(or any other name by which a firm including Ira Levine was known), Edwin Herbert Bentzen IV and Andrew Fenton.

In April, 2023, the parties entered into a settlement agreement and mutual release related to the Ira Levine matter.

The Settlement Agreement is not related to the Assignment of Litigation Agreement.

In March 2023, Legacy MIC's former CEO filed a complaint against Legacy MIC.

On September 6, 2023, the parties entered into a settlement agreement, and we recognized a gain of approximately $ 1.2 million which was recorded as Other Income, Net in the Consolidated Statements of Operations for the year ended December 31, 2023.

In January 2023, the 43rd District Court of Parker County, Texas, entered summary judgment against MVP Fort Worth Taylor, LLC, a subsidiary of Legacy MIC, in favor of the plaintiff, John Roy, who alleged that he was due a commission relating to a proposed sale of the Fort Worth Taylor parking facility which was never consummated.

Legacy MIC filed an appeal.

As a result of the court’s summary judgment, in December 2022 we recognized a charge of $ 0.7 million for the full estimated amount of damages (including legal fees and costs).

The $ 0.7 million was recognized within Organizational, Offering and Other Costs in our Consolidated Statements of Operations and Accounts Payable and Accrued Expenses on our Consolidated Balance Sheets.

During the first quarter of 2023, and as part of the appeals process, we posted cash collateral of $ 0.7 million for an appeals bond, which is reflected in Cash-Restricted on our Consolidated Balance Sheets.

In February 2024 we signed a settlement agreement which would result in the sale of one of our properties to John Roy with the estimated $ 0.7 million of damages being given as a credit at the time of sale.

This sale is contingent upon John Roy obtaining a lender commitment for financing by April 15, 2024, as well as normal due diligence contingencies in the purchase contract

In September 2023, we entered into arbitration with one vendor regarding disputes over amounts payable.

The entire balance in dispute of approximately $ 1.8 million is accrued for in Accounts Payable and Accrued Expenses on the Consolidated Balance Sheets.

Note Q — Related Party Transactions and Arrangements

Two of our assets, 1W7 Carpark and 222W7, are currently operated by PCA, Inc., dba Park Place Parking.

In July 2024, the Texas Court of Appeals, Second District, reversed the decision of the District Court granting summary judgement in favor of Mr.

Roy and remanded the case to the District Court for further consideration.

As a result of the District Court’s summary judgment, in December 2022 we recognized a charge of $ 0.7 million for the full estimated amount of damages (including legal fees and costs).

During the first quarter of 2023, and as part of the appeals process, Legacy MIC posted cash collateral of $ 0.7 million for an appeals bond.

In September 2024, a settlement was reached resulting in a gain on the settlement of approximately $ 0.3 million which is reflected in Other Income, Net in the Consolidated Statements of Operations for the year ended December 31, 2024.

In September 2023, we entered into arbitration with one vendor regarding disputes over amounts payable of approximately $ 1.8 million.

In June 2024, a settlement was reached and the net impact of the gain on the settlement and related legal and administrative fees is immaterial to the Consolidated Statements of Operations for the year ended December 31, 2024.

Note 17 — Related Party Transactions and Arrangements

Three of our assets, 1W7 Carpark, 222W7 and Whitefront Garage, are currently operated by PCA, Inc., dba Park Place Parking.

Park Place Parking is a private parking operator that is wholly owned by relatives of our CEO.

Our CEO is neither an owner nor beneficiary of Park Place Parking.

Park Place Parking has been operating these assets for six and five years, respectively.

Both assets were acquired in 2021 with their management agreements in place.

As of December 31, 2023 and 2022, we recorded balances of approximatel y $ 0.1 million an d $ 0.1 million, respectively, from Park Place Parking which are included in Accounts Receivable, Net on the Consolidated Balance Sheets and were subsequently paid within terms of the lease agreement.

In May 2022, the Company entered into a lease agreement with ProKids, an Ohio not -for-profit.

An immediate family member of the Company’s CEO is a member of the Board of Trustees and President-Elect of that organization.

As of December 31, 2024 and 2023, we recorded balances of approximately $ 0.2 million and $ 0.1 million, respectively, from Park Place Parking which are included in Accounts Receivable, Net on the Consolidated Balance Sheets and were subsequently paid within terms of the management agreement.

In May 2022, we entered into a lease agreement with ProKids, an Ohio not -for-profit.

An immediate family member of our CEO is a member of the Board of Trustees and President of that organization.

ProKids leased 21,000 square feet of vacant unfinished commercial space in a 531,000 square foot building in Cincinnati, Ohio for 120 months.

ProKids will invest in the tenant improvements in this space and ultimately use it as their headquarters location.

ProKids will have no rent due to the Company throughout the lease term, other than a rental fee on parking spaces used by the ProKids staff and visitors.

As of December 31, 2023, ProKids does not owe the Company rental income related to the lease agreement.

ProKids will have no rent due to us throughout the lease term, other than a rental fee on parking spaces used by the ProKids staff and visitors and payment toward common area utility costs.

As of December 31, 2024, ProKids owes an immaterial amount of rental income related to the lease agreement.

In connection with our recapitalization transaction in August 2021, we owe approximately $ 0.5 million to certain member entities of Color Up relating to prorated revenues for the month of August 2021 of the three properties contributed by Color Up.

The accrual is reflected within Due to Related Parties on the Consolidated Balance Sheets.

Additionally, in connection with our recapitalization transaction in August 2021, we were due approximately $ 156,000 from Color Up as consideration for OP Units then issued which was reflected within Due from Related Parties on the Consolidated Balance Sheet as of December 31, 2022.

We received all amounts due in March 2023.

We have agreed to pay for certain tax return preparation services of Color Up and certain member entities of Color Up.

We have incurred approximately $ 0.1 million related to these services which is reflected in General and Administrative on the Consolidated Statements of Operations for the year ended December 31, 2023.

Total fees are estimated to be approximat ely $ 0.1 m illion.

We have agreed to pay for certain tax return preparation services of Color Up and certain member entities of Color Up as well as certain legal services in connection with the Registration Rights Agreement.

We incurred approximately $ 0.1 million and approximately $ 50,000 related to these services which is reflected in General and Administrative and Other Income (Expense), respectively, on the Consolidated Statements of Operations for the year ended December 31, 2024.

License Agreement

On August 25, 2021, we entered into a Software License and Development Agreement with an affiliate of Bombe Asset Management, Ltd., an affiliate of our CEO and CFO (the “Supplier”), pursuant to which the we granted to the Supplier a limited, non-exclusive, non-transferable, worldwide right and license to access certain software and services for a fee of $ 5,000 per month.

On August 25, 2021, we entered into a Software License and Development Agreement with an affiliate of Bombe Asset Management, Ltd., an affiliate of our CEO and President (the “Supplier”), pursuant to which we granted to the Supplier a limited, non-exclusive, non-transferable, worldwide right and license to access certain software and services for a fee of $ 5,000 per month.

Tax Matters Agreement

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In addition, and for so long as the Protected Partners own at least 20% of the units in the Operating Partnership received in the Transaction, we agreed to use commercially reasonable efforts to provide the Protected Partners with similar guarantee opportunities.

Note R — Subsequent Events

In preparing the consolidated financial statements, we have evaluated subsequent events through the date of filing of this report on Form 10 -K for recognition and/or disclosure purposes.

In addition to the subsequent events discussed in the notes above, in the first quarter of 2024, 26 of our 43 assets converted to management contracts in which revenues and expenses are fully the responsibility of and recognized by us and our operators are paid a set fee.

Line of Credit

In September 2024, we entered into a $ 40.4 million Line of Credit.

Osher, co-chair of the Company’s board of directors, is the managing member of No Street Capital LLC, which serves as the investment manager of the Lenders.

For further discussion of the Line of Credit, refer to Note 7 above.

Note 18 — Segment Information

Our principal business is the ownership and operation of parking facilities.

We do not distinguish our principal business, or group our operations, by geography or size for purposes of measuring performance and managing the business on a consolidated basis.

Accordingly, we have presented our results as a single reportable segment:

The accounting policies of the parking segment are the same as those described in Note 2 – Significant Accounting Policies.

The parking segment derives revenue from managed property revenue and rental income at our parking facilities.

We provide access to our property and space for the parker’s vehicle and are entitled to fees that vary based on the level of usage.

All revenue and assets are domestically derived and located.

Our chief operating decision maker (“CODM”) is our chief executive officer.

Our CODM assesses performance for the parking segment and decides how to allocate resources based on net income that is also reported on the Consolidated Statement of Operations as Net Loss.

Disaggregated segment expenses are consistent with those presented on the Consolidated Statement of Operations.

The measure of segment assets is reported on the Consolidated Balance Sheets as Total Assets.

The CODM uses net income to evaluate return on assets.

Net income is predominantly used in the annual budget and forecasting process.

The CODM considers budget to actual variances in assessing performance of the segment and allocating resources.

We do not have intra-entity sales or transfers.

For information about the parking segment for the years ended December 31, 2024 and 2023, refer to the Consolidated Statement of Operations.

Note 19 — Revision of Previously Issued Financial Statements

During the year ended December 31, 2024, the Company identified certain errors impacting our 2023 annual filing.

The error resulted from a need to adjust the carrying amount of noncontrolling interest related to conversions of preferred shares into common shares.

Management assessed the materiality of these errors and concluded the misstatements were not material to the audited financial statements for the period ended December 31, 2023.

Presented below are revisions to the previously issued financial statements presented in this Form 10 -K.

As of December 31, 2023

(in thousands)

Consolidated Balance Sheet:

Additional paid-in capital

$ 240,357 $ 21,827 $ 262,184

Non-controlling interest

$ 93,568 $ ( 21,827 ) $ 71,741

For the Year Ended December 31, 2023

(in thousands)

Consolidated Statement of Changes in Equity

Allocation of equity to non-controlling interest

$ — $ 21,827 $ 21,827

Additional paid-in capital

$ 240,357 $ 21,827 $ 262,184

Non-controlling interest

$ 93,568 $ ( 21,827 ) $ 71,741

REAL ESTATE AND ACCUMULATED DEPRECIATION

8 unchanged sentences

— 3,030 — 19 -- 2,954 — 2,954 10 2016 15

Cincinnati Race Street

— 2,142 2,358 1,900 -- 1,227 1,750 2,977 — 2016 39,15

St Louis Washington

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* 2,056 8,557 114 -- 2,056 8,672 10,728 1,603 2017 39,15

MVP Indianapolis WA Street Lot

* 5,618 — — -- 1,864 — 1,864 — 2017 15

MVP Minneapolis Venture

6 unchanged sentences

1,871 4,631 — 52 -- 4,641 42 4,683 7 2017 N/A

MVP Clarksburg Lot

— 701 — — -- 611 — 611 4 2017 15

MVP Denver 1935 Sherman

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* 7,414 8,860 422 -- 7,414 9,283 16,697 784 2021 39

222 Sheraton Bricktown Garage

* 1,314 16,020 32 -- 1,314 16,052 17,366 1,068 2022 39

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$ 112,659 $ 165,678 $ 262,832 $ 15,884 $ — $ 157,922 $ 259,750 $ 417,672 $ 34,401

( 1 ) The aggregate gross cost of property included above for federal income tax purposes approximately $ 418.1 million as of December 31, 2023.

( 1 ) The aggregate gross cost of property included above for federal income tax purposes was approximately $ 419.6 million as of December 31, 2024 .

( 2 ) The initial costs of buildings are depreciated over 39 years using a straight-line method of accounting;

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Properties II, LLC.

* Property financed under the Revolving Credit Facility

* Property financed under the 2034 CMBS Loan.

The following table reconciles the historical cost of total real estate held for investment for the years ended December 31, 2024 and 2023 (dollars in thousands):

4 unchanged sentences

( 5,290 ) ( 696 )

( 161 ) ( 18,561 )

Balance at close of period

$ 417,672 $ 422,257

This amount does not include intangible assets and construction in progress totaling approximately $ 10.2 million and $ 0.3 million, respectively, as of December 31, 2023 and approximately $ 10.1 million and $ 1.2 million as of December 31, 2022 , respectively.

This amount does not include intangible assets and construction in progress totaling approximately $ 10.1 million and $ 13,000 , respectively, as of December 31, 2024 and approximately $ 10.2 million and $ 0.3 million as of December 31, 2023 , respectively.

The following table reconciles the accumulated depreciation for the years ended December 31, 2024 and 2023 (dollars in thousands):

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Deductions during period:

Impairments ( 9,605 ) —

( 4 ) ( 9,605 )

Depreciation of real estate

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures