What changed in this filing

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Item 1A. Risk Factors

2024-02-23 compared with 2023-02-24 · 13 added, 13 removed, 283 unchanged (8% of the section changed)

2 unchanged sentences

The Company has borrowed substantially in the past and will continue to borrow in the future.

At December 31, 2022, Lamar Advertising Company’s wholly owned subsidiary, Lamar Media, had approximately $3.31 billion of total debt outstanding, net of deferred financing costs, consisting of approximately $985.8 million in bank debt outstanding under Lamar Media’s senior credit facility, $2.08 billion in various series of senior notes, $249.4 million under the Accounts Receivable Securitization Program and $2.0 million in other seller notes.

At December 31, 2023, Lamar Advertising Company’s wholly owned subsidiary, Lamar Media, had approximately $3.34 billion of total debt outstanding, net of deferred financing costs, consisting of approximately $1.01 billion in bank debt outstanding under Lamar Media’s senior credit facility, $2.08 billion in various series of senior notes, $249.6 million under the Accounts Receivable Securitization Program and $1.6 million in other seller notes.

Despite the level of debt presently outstanding, the terms of the indentures governing Lamar Media’s notes and the terms of the senior credit facility and Accounts Receivable Securitization Program allow Lamar Media to incur substantially more debt, including approximately $671.2 million available for borrowing under the revolving credit facility as of December 31, 2023.

35 unchanged sentences

If Lamar Media fails to comply with its financial covenants, Lamar Media could be in default under the senior credit facility and the Accounts Receivable Securitization Program (which could result in an event of default under the indentures governing its outstanding notes).

In the event of such a default under the senior credit facility, the lenders under the senior credit facility could accelerate all of the debt outstanding, could elect to institute foreclosure proceedings against Lamar Media’s assets, and it could be forced into bankruptcy or liquidation.

Any of these events could adversely affect Lamar Media’s business, financial condition and financial results.

22 unchanged sentences

• the pool of suitable acquisition candidates is dwindling, and we may have a more difficult time negotiating acquisitions on favorable terms;

• we may face increased competition for acquisition candidates from other outdoor advertising companies and private equity funds (particularly funds that are focused on investing in media and/or infastruc, some of which may have greater financial resources than we do, which may result in higher prices for those businesses and assets;

• we may face increased competition for acquisition candidates from other outdoor advertising companies and private equity funds (particularly funds that are focused on investing in media and/or infrastructure, some of which may have greater financial resources than we do, which may result in higher prices for those businesses and assets;

• we may not have access to the capital needed to finance potential acquisitions and may be unable to obtain any required consents from our current lenders to obtain alternate financing;

25 unchanged sentences

If the Company’s contingency plans relating to hurricanes and other natural disasters fail, the resulting losses could hurt the Company’s business.

The Company has determined that it is uneconomical to insure against losses resulting from hurricanes and other natural disasters.

The Company has determined that it is uneconomical to insure against losses resulting from hurricanes and other natural disasters for its outdoor or logo structure assets.

Although the Company has developed contingency plans designed to mitigate the threat posed by hurricanes and other forms of inclement weather to its real estate portfolio (e.g., removing advertising faces at the onset of a storm, when possible, which better permits the structures to withstand high winds during the storm), these plans could fail and significant losses could result.

3 unchanged sentences

The Company may have available net operating loss (“NOL”) carry forwards that could reduce or substantially eliminate its REIT taxable income, and thus it may not be required to distribute material amounts of cash to qualify for taxation as a REIT.

The Company expects that, for the foreseeable future, it may utilize available NOL carry forwards to reduce its REIT taxable income.

The Company expects that it may utilize available NOL carry forwards to reduce its REIT taxable income.

The Board of Directors of the Company, in its sole discretion, will determine on a quarterly basis the amount of cash to be distributed to its stockholders based on a number of factors including, but not limited to, the Company’s results of operations, cash flow and capital requirements, economic conditions, tax considerations, borrowing capacity and other factors, including debt covenant restrictions that may impose limitations on cash payments, future acquisitions and divestitures, any stock repurchase program, and general market demand for its advertising space available for rent.

8 unchanged sentences

• provide the Board of Directors the ability to issue additional classes and shares of preferred stock and to set voting rights, preferences and other terms of the preferred stock without stockholder approval.

In addition, Section 203 of the DGCL generally limits the Company’s ability to engage in any business combination with certain persons who own 15% or more of its outstanding voting stock or any of its associates or affiliates who at any time in the past three years have owned 15% or more of its outstanding voting stock.

In addition, Section 203 of the Delaware General Corporation Law generally limits the Company’s ability to engage in any business combination with certain persons who own 15% or more of its outstanding voting stock or any of its associates or affiliates who at any time in the past three years have owned 15% or more of its outstanding voting stock.

These provisions may have the effect of entrenching the Company’s management team and may deprive the Company’s stockholders of the opportunity to sell their shares to potential acquirers at a premium over prevailing prices.

122 unchanged sentences

For these purposes, Lamar Advertising is treated as owning the assets of and receiving or accruing the income of its subsidiaries (other than TRSs).

Thus, compliance with these tests will require Lamar Advertising and its subsidiaries to refrain from certain activities and may hinder their ability to make certain attractive investments, including investments in the businesses to be conducted by TRSs, and to that extent limit their opportunities.

opportunities.

Furthermore, acquisition opportunities in domestic and international markets may be adversely affected if Lamar Advertising needs or requires the target company to comply with certain REIT requirements prior to closing.

7 unchanged sentences

Lamar Advertising structured the Operating Partnership to be classified as a partnership for federal income tax purposes.

However, no assurance can be given the IRS will not challenge Lamar Advertising’s position or will classify the Operating Partnership as a “publicly traded partnership” for federal income tax purposes.

However, no assurance can be given the IRS will not challenge Lamar Advertising’s position or will not classify the Operating Partnership as a “publicly traded partnership” for federal income tax purposes.

To minimize this risk, Lamar Advertising has placed certain restrictions on the transfer and/or redemption of partnership units in the Amended and Restated Limited Partnership Agreement of the Operating Partnership.

11 unchanged sentences

With respect to NOLs, effective for taxable years beginning on or after January 1, 2018, the TCJA limited the deduction for NOL carryforwards to 80% of taxable income (before the deduction) and eliminated NOL carrybacks for individuals and non-REIT corporations (NOL carrybacks did not apply to REITs under prior law), but allows for indefinite NOL carryforwards.

The CARES Act repealed such 80% limitation for carryforwards to taxable years beginning before

January 1, 2021.

The CARES Act repealed such 80% limitation for carryforwards to taxable years beginning before January 1, 2021.

The CARES Act also allows a five-year carryback for NOLs arising in 2018, 2019, or 2020.

2 unchanged sentences

The IRA includes numerous tax provisions that impact corporations, including the implementation of a 15% corporate alternative minimum tax based on “adjusted financial statement income” exceeding $1 billion, as well as a 1% excise tax on certain stock repurchases and economically similar transactions.

However, REITs are excluded from the definition of an “applicable corporation” and therefore are not subject to the corporate alternative minimum tax.

However, REITs are excluded from the definition of an “applicable

corporation” and therefore are not subject to the corporate alternative minimum tax.

Additionally, the 1% excise tax specifically does not apply to stock repurchases by REITs.

2 unchanged sentences

however, the effect of these changes on the value of Lamar Advertising’s assets, shares of Lamar Advertising stock or market conditions, generally, is uncertain.

The individual and collective impact of the changes made by the TCJA, the CARES Act and the IRA on REITs and their security holders are uncertain and may not become evident for some period of time.

The individual and collective impact of the changes made by the TCJA, the CARES Act and the IRA on REITs and their security holders is uncertain and may not become evident for some period of time.

The effect of any technical corrections with respect to the TCJA, the CARES Act or the IRA could have an adverse effect on Lamar Advertising, its subsidiaries, and holders of its securities.

21 unchanged sentences

federal income tax at regular corporate rates and applicable state and local corporate taxes, which may have adverse consequences on its total return to its stockholders.

UNRESOLVED STAFF COMMENTS

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 1A. Risk Factors