UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

☒ Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

for the fiscal year ended October 31, ~~2021~~2022.

☐ Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934.

Commission File Number: 001-34355

IDW MEDIA HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware		26-4831346
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

520 Broad Street, Newark, New Jersey 07102

(Address of principal executive offices, zip code)

~~(973) 438~~323-~~3385~~433-6670

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol		Name of each exchange on which registered
Class B common stock, par value $0.01 per share		IDW		NYSE American

Securities registered pursuant to section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The ~~number~~aggregate market value of ~~shares~~the ~~outstanding~~voting and non-voting stock held by non-affiliates of the registrant, based on the closing price on April 29, 2022 (the last business day of the registrant’s most recently completed second fiscal quarter) of the Class B common stock as of ~~January~~$1.70 17per share, ~~2022~~as reported on the New York Stock Exchange, was: approximately $17.1 million.

Class B common stock, par value $0.01 per share:	12,430,676 shares (excluding 519,360 treasury shares)
Class C common stock, par value $0.01 per share:	545,360 shares

The number of shares outstanding of the registrant’s common stock as of January 17, 2023 was:

Class B common stock, par value $0.01 per share:	13,582,431 shares (excluding 519,360 treasury shares)
Class C common stock, par value $0.01 per share:	545,360 shares

DOCUMENTS INCORPORATED BY REFERENCE

The definitive proxy statement relating to the registrant’s Annual Meeting of Stockholders, to be held ~~April~~March 530, ~~2022~~2023, is incorporated by reference into Part III of this Form 10-K to the extent described therein.

Index
IDW MEDIA HOLDINGS, INC.
Annual Report on Form 10-K

Forward-Looking Information and Factors that May Affect Future Results			ii
Part I
	Item 1.	Business.	1
	Item 1A.	Risk Factors.	89
	Item 1B.	Unresolved Staff Comments.	1820
	Item 2.	Properties.	1820
	Item 3.	Legal Proceedings.	1820
	Item 4.	Mine Safety Disclosures.	1820
Part II
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.	1921
	Item 6.	[Reserved].	1921
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	1921
	Item 7A.	Quantitative and Qualitative Disclosures about Market Risks.	2527
	Item 8.	Financial Statements and Supplementary Data.	2527
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.	2527
	Item 9A.	Controls and Procedures.	2527
	Item 9B.	Other Information.	2528
	Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.	2528
Part III
	Item 10.	Directors, Executive Officers and Corporate Governance.	2629
	Item 11.	Executive Compensation.	2629
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.	2629
	Item 13.	Certain Relationships and Related Transactions, and Director Independence.	2629
	Item 14.	Principal Accounting Fees and Services.	2629
Part IV
	Item 15.	Exhibits, Financial Statement Schedules.	2730
	Item 16.	Form 10-K Summary	2831
Signatures			2932

This Annual Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements that contain the words “believes,” “anticipates,” “expects,” “plans,” “intends” and similar words and phrases. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results projected in any forward-looking statement. In addition to the factors specifically noted in the forward-looking statements, other important factors, risks and uncertainties that could result in those differences include, but are not limited to, those discussed under Item 1A to Part I “Risk Factors” in this Annual Report. The forward-looking statements are made as of the date of this Annual Report, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth in this report and the other information set forth from time to time in our reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934, including our reports on Forms 10-Q and 8-K.

Our business is subject to numerous risks as described in this section. Some of these risks include:

The loss of the main distributor IDWP depends on for its publications could have a material adverse effect on IDWP’s business, prospects and financial condition and the agreement with one of the two primary distributors has expired.

IDWP’s publications may be less successful than anticipated.

IDWP cannot control certain publication delays, cancellations and shipping delays which could adversely affect IDWP’s sales and its ability to meet delivery obligations.

IDWP cannot control the increased industry costs in shipping, printing and paper which in turn impact gross margins.

Any loss of key personnel and the inability to attract and retain qualified employees could have a material adverse impact on IDWE’s operations.

The public health risk of COVID-19 and its impact on productions could adversely affect IDWE’s business.

Increased costs for programming and other rights, as well as judgments we make on the potential performance of IDWE’s content, may adversely affect IDWE’s profits and balance sheet.

Part I

As used in this Annual Report, unless the context otherwise requires, the terms the “Company,” “IDW Media Holdings,” “we,” “us,” and “our” refer to IDW Media Holdings, Inc., a Delaware corporation, and its subsidiaries, collectively. Each reference to a fiscal year in this Annual Report refers to the fiscal year ending in the calendar year indicated (for example, fiscal 2021 refers to the fiscal year ended October 31, 2021).

Item 1. Business.

OVERVIEW

We were incorporated in the State of Delaware in May 2009.

In 2009, IDT Corporation, our former parent corporation, completed a tax-free spinoff (the “Spin-Off”) of the Company through a pro rata distribution of our common stock IDT’s stockholders.

IDW Media Holdings, Inc., a Delaware corporation, is a holding company consisting of the following principal businesses:

● IDW Publishing, or IDWP, a publishing company that creates comic books, graphic novels, digital content through its imprints IDW, Top Shelf Productions, Artist’s Editions and The Library of American Comics; and

● IDW Entertainment, or IDWE, is a production company and studio that develops, produces and distributes content based on IDWP’s original IP for a variety of formats including film and television.

IDWP is an award-winning publisher of comic books, original graphic novels, and art books. Founded in 1999, IDWP has a long tradition of supporting original, powerful creator-driven titles. In 2002, IDWP published 30 Days of Night by Steve Niles and Ben Templesmith followed by other horror titles that kickstarted a resurgence in horror-comic publishing across the industry. Since then, IDWP has significantly diversified its publications. Joe Hill and Gabriel Rodríguez’s Locke & Key, Jonathan Maberry’s V Wars, Stan Sakai’s Usagi Yojimbo, Beau Smith’s Wynonna Earp, Alan Robert’s The Beauty of Horror adult coloring books, and Darwyn Cooke’s graphic novel adaptations of Richard Stark’s Parker novels are just a few of the hundreds of outstanding, award-winning titles published since its inception.

IDWE is a production company and studio that develops and produces content and formats for global platforms and services. Most recently, in partnership with Netflix, IDWE launched the second season of Locke & Key, with a third season already planned for Fall/Winter 2022. In addition, a new live action series based on the graphic novel Surfside Girls, is in production for Apple TV+.

Financial information by segment is presented in Note 6 in the Notes to our Consolidated Financial Statements in Item 8 of this Annual Report.

Our headquarters are located at 520 Broad Street, Newark, New Jersey 07102. The main telephone number at our headquarters is (212) 658-1450 and our corporate web site’s home page is www.idwmediaholdings.com.

We make available free of charge our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to these reports, and all beneficial ownership reports on Forms 3, 4 and 5 filed by directors, officers and beneficial owners of more than 10% of our equity through the investor relations page of our web site (https://idwmediaholdings.com/investors/) as soon as reasonably practicable after such material is electronically filed with the Securities and Exchange Commission. Our web site also contains information not incorporated into this Annual Report on Form 10-K or our other filings with the Securities and Exchange Commission.

Recent Developments

On August 6, 2021, we closed a registered public offering of our Class B common stock underwritten by EF Hutton, division of Benchmark Investments, Inc. (“EF Hutton”). We sold an aggregate of 2,875,000 shares of our Class B common stock for gross consideration of $10,350,000 (including EF Hutton’s exercise in full of the overallotment option) less Underwriters commissions of $724,500 and Underwriters expenses of $75,000.

IDWP’s smash-hit comics series Teenage Mutant Ninja Turtles: The Last Ronin shattered all expectations and has surpassed an incredible 650,000 copies in print! Demand for Kevin Eastman and Peter Laird’s epic tale of a dystopian TMNT future continues to soar leading into the series finale.

The new IDW Digital Experience launched in Fall 2021 with a new website and mobile app with increased marketing and sales capabilities and improved user experience.

IDWP celebrated a milestone 30th Anniversary for Sonic the Hedgehog in June 2021, with special anniversary comics and graphic novels and a major marketing campaign resulting in increased sales and brand awareness.

In 2021, IDWP titles brought home prestigious industry awards including 5 Ringo Awards, 2 Reuben Awards, and 3 Eisner Awards.

In October 2021, Locke & Key, the smash hit series based on the IDWP’s graphic novels written by Joe Hill and illustrated by Gabriel Rodríguez, premiered its second season on Netflix and led to a sales spike in comics and graphic novels. The third season, which has already been shot, will premiere on Netflix Fall/Winter of 2022.

In December 2021, Apple TV+ greenlit and went into production on our original live action kids’ series Surfside Girls based on the Top Shelf Productions graphic novels by Kim Dwinell; developed and produced in conjunction with Endeavor Content.

COVID-19: Overview of Impacts

IDWMH: Received two PPP loans related to core IDWE and IDWP operations.

o $1,195,679 on April 27, 2020, subsequently forgiven on July 20, 2021

o $1,195,680 on April 2, 2021, subsequently forgiven on October 27, 2021

● IDWE: Industry-wide production suspensions halted filming and production of Wynonna Earp Season four after the completion of six of twelve episodes. IDWE continued its program to develop, package and pitch from its library on remote basis. Writer’s rooms have transitioned to virtual operations.

● IDWP: Direct market distribution was halted in April 1, 2020 by Diamond Comic Distributors, Inc. (Diamond), the industry’s primary distributor, and IDWP subsequently furloughed approximately 25% of its workforce. Using the proceeds of PPP loans, IDWP was able to bring back 50% of the furloughed workforce. IDWP transitioned to focus on direct-to-consumer (“DTC”) and indirect market channels, and was able to offset the lost direct market sales. Diamond resumed partial operations on May 20, 2020. Direct market sales volumes have since risen, past pre-COVID-19 levels and most products sold through Diamond have reverted back to pre-COVID-19 non-returnability with limited exceptions. Sales through Penguin Random House Publisher Services (PRHPS), a largely returnable market, have seen decreased overall returns. Effective in April 2021, the return policies have reverted back to pre-COVID-19. IDWP renegotiated the terms of one of its lease agreements due to COVID-19 impacts. Per ASC 842 guidance the lease liabilities were remeasured as of the modification dates as if the leases were new leases commencing at such time. Accordingly, the Right-Of-Use assets were adjusted by amounts equal to the adjustments to the lease liabilities. Although the delay in comic releases continues to have an impact on the industry, the impact has been slowly decreasing and returning to pre-COVID-19 levels.

Business Description

In Fiscal 2021, our principal businesses consisted of:

i. IDWP, a publishing company that creates comic books, graphic novels, digital content and games through its imprints IDW, IDW Games, Top Shelf Productions, Artist’s Editions and The Library of American Comics; and

ii. IDWE, is a production company and studio that develops, produces and distributes content based on IDWP’s original IP for a variety of formats including film and television. Most recently, in partnership with Netflix, IDWE launched the second season of Locke & Key, with a third season already planned for Fall/Winter 2022. In addition, a new live action series based on the graphic novel Surfside Girls, is in production

During calendar 2021, we began to winddown IDW Games and, going forward, IDW Games is only backfilling final orders Prior to February 15, 2021, we also owned CTM Media Group (CTM), a company that develops and distributes print and digital-based advertising and information advertising for tourist destinations in targeted tourist markets in 32 states / provinces in the US and Canada. On February 15, 2021, we consummated the sale of CTM to an assignee of Howard Jonas, the Company’s Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness we owed to our Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the sale, and (iii) a contingent payment if CTM is sold within 36 months of the sale for more than $4.5 million. As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the financial statements as discontinued operations.

IDW Publishing

IDWP’s focus is to expand and market its library of titles, from both creator-owned titles in our IDW and Top Shelf brands; and also, in partnership with our top-of-class creative partners under our IDW brand. IDWP works synergistically with IDWE to develop new titles and to support existing titles.

In 2015, IDWP acquired Top Shelf Productions, an award-winning critically acclaimed publisher of graphic novels, which continues to operate as a thriving imprint. Top Shelf Productions is renowned for publishing works of literary significance including the #1 New York Times and Washington Post bestselling trilogy, March, by Congressman John Lewis, Andrew Aydin, and Nate Powell. March is the only graphic novel to have won the National Book Award and is the second most taught graphic novel in schools. In July 2019, Top Shelf Productions released George Takei’s graphic memoir, They Called Us Enemy, which debuted at #2 on the New York Times Paperback Nonfiction Best Sellers list and as a #1 bestseller on Amazon. Both titles are now perennial bestsellers and considered two of the finest non-fiction graphic novels ever made. Other iconic Top Shelf Productions titles include Kim Dwinell’s Surfside Girls, Jeff Lemire’s Essex County and The Underwater Welder, and Hannah Templer’s Cosmoknights.

In addition to its core of creator-driven franchises, IDWP has also partnered with the owners of major licensed brands to publish many successful licensed titles, including Hasbro’s Transformers, G.I. Joe, Dungeons & Dragons and My Little Pony; Sega’s Sonic The Hedgehog; CBS’s Star Trek; Viacom’s Teenage Mutant Ninja Turtles; Toho’s Godzilla; and Lucasfilm’s Star Wars Adventures. These licensed titles bring with them diverse built-in audiences and build cache and retailer support for IDWP. With licensed franchises, IDWP’s strategy is to focus not only on licenses that have eager, built-in fan followings but also ongoing licensor support through other channels, such as toys, animation, and film. This strategy enables IDWP to expand its audience reach and to pursue sub-license opportunities with foreign publishers. IDWP also collaborates with other comic book publishers to co-publish certain titles, including Batman vs. Teenage Mutant Ninja Turtles and Locke & Key/The Sandman Universe: Hell & Gone (with DC Comics), Rick & Morty vs. Dungeons & Dragons (with Oni Press, Inc.) and Godzilla vs. Power Rangers (with Boom Studios).

IDWP is also home to Artist’s Editions, oversized deluxe hardcovers featuring scans of original art printed at the same size they were drawn with all the distinctive creative nuances that make original art unique. Some of the standout Artist’s Editions titles include Jim Lee’s X-Men, Mike Mignola’s Hellboy, David Mazzucchelli’s Daredevil Born Again and Jim Sterako’s Nick Fury Agent of SHIELD.

Many of IDWP’s titles are available worldwide through foreign licensing with 642 titles available in 62 territories in 24 languages. In 2020, IDW kicked off a major new initiative to release key titles as Spanish-language graphic novels in the North American market with the release of Spanish-language editions of They Called Us Enemy, Red Panda & Moon Bear, Locke & Key and Sonic the Hedgehog.

IDWP’s largest segment is the publication of comic book and trade paperback products. Its comics and graphic novels are primarily distributed through three channels: (i) to comic book specialty stores (the “direct market”). Diamond serves as IDWP’s distributor to the direct market, worldwide and beginning June 1, 2022, PRHPS will replace Diamond as IDWP’s distributor to the direct market. Although returnability was offered temporarily on products sold to the direct market in light of COVID-19, most products have reverted back to pre-COVID-19 non-returnability; (ii) to traditional retail outlets, including bookstores and mass market stores, on a returnable basis (the “non-direct market”). IDWP’s non-direct market distributor is PRHPS. IDWP works together with PRHPS to sell-in and promote IDWP titles to buyers at non-direct market customers such as Amazon, Barnes & Noble, Baker & Taylor, Ingram, Follett, Target, Walmart, and more; and (iii) to Ebook distributors (“digital publishers”). IDWP’s publications are widely available digitally through popular distributors such as Comixology, Amazon, Apple iTunes and iBooks, Google Play, Hoopla, Overdrive, and via IDWP’s own webstore at idwpublishing.com. Through the direct market and non-direct market, IDWP, including its imprint Top Shelf Productions, sold over 5.2 million units in fiscal year 2020 and was recognized as the fourth largest publisher in its category in calendar year 2019.

IDWP’s original agreement with Penguin Random House in June 2016 had a three-year term and automatically renewed for another three years unless terminated earlier. Pursuant to the agreement, Penguin Random House is the exclusive worldwide distributor for all IDWP products other than periodical comic books for the non-direct market channel, and provides of the following services: warehousing, customer service, order fulfilment, shipping, returns processing, billing/collections, customer credit management, sales, sales reporting, stock control and Web-access to sales and inventory information. In addition, to the non-direct market channel, IDWP’s agreement allows for Penguin Random House to provide distribution on a non-exclusive basis for the direct-to-consumer channel through Penguin Random House online consumer sites in the United States and Canada.

The agreement obligates Penguin Random House to, among other things, use reasonable skill and care in accordance with its usual practice in providing the services; and maintain a reserve against future returns. The agreement provides for the allocation of risk related to the products to be distributed between the IDWP and Penguin Random House and related to collection of amounts owing.

The agreement provides that both IDWP and Penguin Random House will not be liable to each other for failure to perform any obligation under the agreement to the extent that and so long as the failure is caused matters beyond their control.

The agreement also provides that either party may terminate the agreement upon a material or persistent uncured breach by the other party, or, on six months’ notice following a change of control of either party or party’s parent.

The agreement also contains customary indemnification and confidentiality provisions.

In June 2021, the original agreement with PRHPS was amended pursuant to which the original term was extended to March 31, 2024 and IDWP granted PRHPS exclusive worldwide multi-year sales and distribution rights for IDWP’s newly published and backlist comic book periodicals, trade collections, and graphic novels to the Direct Market comic shops beginning June 1, 2022. Pursuant to the amendment, PRHPS will (1) provide warehousing, customer service, order fulfilment, shipping, returns processing, billing/collections, customer credit management, sales, sales reporting, stock control and Web-access to sales and inventory information for IDWP’s single issue comic books and other products manufactured by IDWP and intended for distribution to the direct market and (2) maintain and operate a .biz retailer website for the provision of such services to IDWP.

In 2014, IDWP launched IDW Games to develop and publish card, board, and tabletop games. Similar to IDWP’s book content, IDW Games offered a mix of popular licensed titles and creator developed strategic hobby games. IDW Games’ products were sold to distributors worldwide and are available through retailers such as Gamestop, Barnes & Noble, and Amazon, independent games and comics stores, as well as the direct-to-consumer channel through its website and marketing campaigns. In calendar 2021, the Company wound down IDW Games and, going forward, IDW Games is only backfilling final orders.

To further expand and build creator-owned properties beyond publishing, IDWP works with IDWE, as well as other outside partners, to bring creator-owned franchises to television and film through licensing arrangements.

To expand its business and outperform its industry competitors, IDWP continues to focus on launching new creator-owned titles and partnering with established brands to bring fan-favorite properties to the comics market. IDWP is expanding the reach of existing and new products through the development of specialty, library, and education markets; increased direct-to-consumer initiatives; and broadening the reach of creator-driven series through licensing opportunities.

In May 2019, IDWMH invested in a new publishing entity, Clover Press, established by Ted Adams and Robbie Robbins, co-founders of IDWP. Clover Press is a separate entity and operates independently from IDWP. Due to its size, and nature of the business, activity related to Clover Press was included with IDWP for presentation purposes while it was a consolidated entity. Effective April 1, 2020 IDWMH’s interest in Clover Press decreased to 19.9%, as a result it is now an investment valued at cost and no longer consolidated.

IDWP’s revenues represented 78% and 62.5% of our consolidated revenues in the fiscal years ended October 31, 2021 and 2020, respectively.

IDW Entertainment

IDWE is a production company and studio that develops, produces and distributes content based on IDWP’s original IP for a variety of formats including film and television.

IDWE was formed on September 20, 2013 to leverage IDWP properties into television series, features and other forms of media by developing and producing original content. IDWE maintains a robust development slate of properties based on IDWP properties primarily for the adult series marketplace and is in advanced conversations with various global studios and networks for their exploitation. IDWE actively recruits and acquires new franchise material for exploitation primarily in the series format.

IDWE has developed and/or produced three series for television that premiered in calendar 2020 and 2021:

	●	Wynonna Earp season four aired in two parts due to worldwide COVID-19 related production shutdowns. The first six episodes of season four premiered July 26, 2020 and the second half of season four began airing March 5, 2021. The show was created by Emily Andras and stars Melanie Scrofano and is based on the IDWP comics of Beau Smith. Season four’s twelve episodes are being produced by Seven24 Films and distributed by IDWE, in partnership with Syfy and CTV Sci-Fi. Cineflix Studios is the co-producer and global distributor for the series. Season one’s thirteen episodes aired in fiscal 2016. Season two’s twelve episodes aired in fiscal 2017, and Season three’s twelve episodes aired in fiscal 2018.
	●	V Wars debuted on Netflix on December 5, 2019. The 10-episode vampire thriller stars Ian Somerhalder and was produced by High Park Entertainment. The series was based upon Jonathan Maberry’s IDWP comic book series of the same name. The rights to IDWE’s streaming genre series V Wars reverts back to IDW in 2022; as a result we will be exploring opportunities to monetize the past season and potential opportunities to continue the story with a new partner.

● October Faction premiered on Netflix on January 23, 2020. The 10-episode show was based on the IDWP comics of Steve Niles and Damien Worm and was adapted by showrunner Damian Kindler and starred Tamara Taylor and J.C. MacKenzie. It was also produced by High Park Entertainment.

● Locke & Key premiered on Netflix on February 7, 2020. The show is based on the critically-acclaimed graphic novels of Joe Hill and Gabriel Rodriguez published by IDWP. Season two has been set to air in October 2021 and Season three has been ordered by Netflix.

● IDWE recently closed a deal to develop a new animated series based on one of our popular Top Shelf graphic novels with a major kid’s cable network.

Surfside Girls is currently in production for Apple TV+ and is based on the Top Shelf graphic novel of the same name. The 10-episode season one live-action series will wrap production in February 2022 and, while there is no release date yet announced, will most likely premiere before the end of 2022.

While in the past IDWE focused solely on TV development and production opportunities, a broadening of our strategic goals has evolved to focus on the building of a film slate and podcast opportunities. With more varied opportunities for our content and IP, we will be able to grow our brand, expand the perception of what IDWE does, and ultimately grow revenue and opportunities as an entertainment production/studio in the comic book/graphic novel space.

IDWE’s revenues represented 22.0% and 37.5% of our consolidated revenues in the fiscal years ended October 31, 2021 and October 31, 2020, respectively.

CTM (Discontinued operations)

As a result of the economic downturn related to the COVID-19 pandemic, and the impact it had on CTM, the Company decided to sell CTM and focus on our entertainment and publishing business. Pursuant to a SPA dated as of July 14, 2020, we sold all of the stock of CTM to an assignee of the Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness owed by us to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date, and (iii) a contingent payment if CTM is sold within 36 months of the CTM Sale Date for more than $4.5 million. The CTM Sale closed on February 15, 2021 and CTM is only consolidated up until the sale date with the gain reflected separately in the consolidated statement of operations.

Our Strategy

IDWP and IDWE work together to jointly and synergistically develop and produce books and entertainment so as to allow us to capitalize on the global demand for original content from streaming services as well as traditional broadcast and other networks and other content services. We seek to improve our strategic positioning across all media, whenever possible and financial performance by primarily focusing on development of entertainment that can generate value from our intellectual property and to increase coordination between IDWP and IDWE to improve our development pipeline. To date, we have sold projects to Hulu, Syfy, BBC America, Netflix and Endeavor Content, while others are in active discussion. We believe that our potential projects would be attractive to a broad range of potential distribution channels and participants.

We seek to own “all rights” to intellectual property (“IP”) of our content in order to, afford us significant production-based fees supplemented by merchandising, games, video and other fandom-driven revenue opportunities.

We believe that our key strategic points of differentiation include:

● IP creation, control and ownership through a creator-friendly (e.g., Steve Niles, Joe Hill) publishing engine and high-value licenses (e.g. ViacomCBS, Sega).

● TV and film development, production and distribution (e.g., Surfside Girls, Locke & Key) with a platform agnostic approach to partnership.

● Merchandise via partnerships and direct-to-consumer sales.

Given recent developments surrounding COVID-19, IDWP has revised its ongoing release schedule to better align with the needs and capacity of the changing retail marketplace. IDWP continues to serve both the direct and non-direct markets through its distribution partners and has added an increased focus on direct to consumer, digital initiatives, and development of merchandise. Content generation remains a key priority for IDWP as we continue to launch new creator-owned titles and expand partnerships with established brands to bring fan-favorite properties to the comics, graphic novel, and games markets. During the market slowdown, IDWP was able to quickly reduce ongoing content production to better suit the needs of the organization at the time, picking back up as the market showed signs of recovery.

In an effort to manage the risks associated with COVID-19, IDWE diversified its development slate and staffed appropriately to focus on both kids and adult animation projects, which minimize the effects of COVID-19 through remote work-from-home initiatives. IDWE can shift into work-from-home protocols seamlessly thanks to our centralized filing and workflow systems. Though television will remain the core business, we are also expanding into podcasts, and other digital content as a way to increase the creation of IP.

Competition

IDWP competes most directly with both public and privately held companies that publish or license for publishing comic books and graphic novels, and further develop their franchises through digital media including shows and feature films. Public company competitors for IDWP include Disney (Marvel) and WarnerMedia (DC). Privately held competitors include Oni Press, Boom! Studios, Dark Horse (Embracer Group) and Image Comics.

IDWE competes with all forms of entertainment. A significant number of companies produce and/or distribute television shows and films, and provide pay television and SVOD programming services. IDWE also competes to obtain creative talents and story properties that are essential to the success of our IDWE business.

The success of our operations is heavily dependent upon public taste and preferences. In addition, operating results fluctuate due to the timing and performance of releases in the television and book markets. Release dates are determined by several factors, including competition and the timing of vacation and holiday periods.

Intellectual Property

There are two primary sources of the content that IDWP develops, publishes, and exploits across a range of distribution channels:

● Original, creator-owned material that marks its debut to the consuming public via IDWP’s published products (“Creator Content”); and

● Content that has already been successfully exploited in other media (“Licensed Content”).

IDWP enters into publishing agreements with owners of both Creator Content and Licensed Content pursuant to which IDWP licenses the right to exploit such content (“Publishing Agreements”).

IDWP’s Publishing Agreements grant to IDWP exclusive, long term, worldwide rights to publish and sell the licensed content in all languages via traditional channels such as print and digital comics, graphic novels, and trade collections, and niche channels such as board games, coloring books, audio on demand, and high-end limited edition publications (“Publishing Rights”).

A smaller percentage of Publishing Agreements cover a more limited range of licensed rights in order to accommodate pre-existing products and markets already established by licensors such as foreign publishers seeking to have IDWP publish an English only version, licensed content owners seeking expansion into niche markets that can be more successfully exploited by IDWP, and establish authors who have already enjoyed publishing success prior to partnering with IDWP.

Many of IDWP’s Creator Content Publishing Agreements also grant to IDWP exclusive film, television, merchandising, and other ancillary worldwide rights in all formats, languages, and current and future media and delivery technologies (“Ancillary Rights”) that can then be exploited through IDWE or otherwise.

IDWP exploits the Publishing Rights via sales to comic book specialty stores, traditional retail outlets, and direct to consumers, and via sublicenses to digital distribution platforms and foreign territory sub-publishers.

IDWP exploits the Ancillary Rights primarily via its relationship with IDWE, but also through other third-party buyers.

IDWP has registered and owns domain names that it uses to digitally promote and sell its products. It also has trademarked its name and logo, as well as the name and logo of its Top Shelf Productions imprint.

IDWP has developed game mechanics for certain of its game products that it treats as proprietary intellectual property in its Publishing Agreements.

Regulation

The County of Los Angeles, in the state of California, has been subject to regulatory protocols associated with reopening the music, television and film production industries, which were closed as a result of COVID-19. Effective June 12, 2020, the County of Los Angeles Department of Public Health adopted a staged approach, supported by science and public health expertise, to allow music, television and film production to resume. These protocols, which are required to be adhered, cover (1) workplace policies and practices to protect employee health; (2) measures to ensure physical distancing; (3) measures to ensure infection control; (4) communication with employees and the public; and (5) measures to ensure equitable access to critical services. We are complying with all regulatory protocols associated with the County of Los Angeles Department of Public Health.

Employees

As of January 19, 2022, the Company had 78 full-time United States employees and 3 part-time employees, including 58 full-time employees and 2 part-time employees at IDWP, 10 full-time employees at IDWE, and 10 full-time employees and 1 part-time employee at IDW Media Holdings.

Item 1A. Risk Factors.

RISK FACTORS

Our business, operating results or financial condition could be materially adversely affected by any of the following risks associated with any one of our businesses, as well as the other risks highlighted elsewhere in this document. The trading price of our common stock could decline due to any of these risks. Note that references to “our”, “us”, “we”, “the Company”, etc. used in each risk factor below refers to the business about which such risk factor is provided.

Risks Associated with Our Business

Public health threats could have an adverse effect on the Company’s operations and financial results

In early 2020, the spread of the COVID-19 virus resulted in a worldwide pandemic. We are actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential and actual impact on each of our operating segments. While we believe that, in 2021, there has been significant improvement due to global and domestic vaccination efforts, we cannot predict the ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and our operations and our customers and partners may continue to be impacted.

In February 2021, due to the impact of the COVID-19 pandemic on the travel and tourism markets, we sold CTM. CTM had substantially suspended operations in March 2020 as key clients closed and tourism halted in key markets and gradually resumed partial operation since June 2020 in accordance with and as permitted by state and local COVID-19 regulations. In March 2020, CTM furloughed all non-essential personnel, approximately 90% of its workforce, and has gradually been growing its active personnel roster as needed in its resumption of operations.

In April 2020, as a result of the COVID-19 pandemic, IDWP’s direct-market distributor paused the release of new product, including IDWP’s; the direct-market distributor’s operations resumed in a limited capacity in late May 2020 and continue at an increasing rate as of the date of this Prospectus, and IDWP’s products have resumed being distributed. Many retailers experienced closures, reduced operations, or de-prioritization of entertainment products, such as books and games, throughout the COVID-19 pandemic resulting in decreased sales of certain of IDWP’s products. Additional closures, restrictions, or virus spikes could have a further negative impact on IDWP’s distribution channels and retail customers. We are unable to accurately predict the full impact that the COVID-19 pandemic will have on distributions, purchasing, sales, returns, cash receipts and overall revenue.

The COVID-19 pandemic resulted in the production of television shows being periodically suspended depending on local governmental authorities and regulatory requirements in place at any given time. Due to various uncertainties, including the ultimate geographic spread of the virus, the rise of variants that may occur, the severity of the disease, the duration of the outbreak, and actions that may be taken by governmental authorities, further production risks could arise.

For all these reasons, the COVID-19 pandemic could have a material adverse impact on our business and financial results.

We have a history of continued operating losses at IDWE and IDWP and cannot be certain of our future profitability.

We ~~had~~ ~~accumulated~~will alikely ~~net~~need ~~deficit~~additional ~~through~~capital ~~October 31, 2021, of approximately $80.1 million. Prior~~ to ~~the~~sustain ~~CTM~~our ~~Sale, which closed~~operations ~~on February 15, 2021,~~ and ~~until~~will ~~the~~likely ~~start~~need ofto ~~the~~seek ~~COVID-19~~further ~~pandemic~~financing into ~~April~~accelerate ~~2020~~our growth, which we ~~often~~may ~~used~~not ~~cash~~be ~~flows~~able ~~from CTM~~ to ~~partially~~obtain ~~provide funding~~on ~~for~~acceptable ~~corporate~~terms ~~overhead~~or ~~and for our IDWP and IDWE operations~~at all. InIf ~~Fiscal 2021,~~ we ~~generated~~are ~~positive~~unable ~~cash~~to ~~flow~~raise ofadditional ~~$7.9 million~~capital, ~~while~~ ~~IDWE,~~as ~~IDWP and CTM generated negative cash flow of $0.5 million~~needed, ~~$0.3~~the ~~million~~future ~~and~~growth ~~$1.6 million, respectively. In Fiscal 2020, we and CTM generated positive cash flow~~ of ~~$8.0~~our ~~million~~business and ~~$.8~~operations ~~million,~~would ~~respectively,~~be ~~while~~severely ~~IDWP and IDWE generated negative cash flow of $5~~limited.~~8 million and $1.0 million, respectively.~~

~~We may~~IDWP ~~incur~~depends ~~losses~~on inone ~~the~~main ~~foreseeable~~distributor ~~future as we may seek financing~~ for, ~~and~~its ~~invest~~direct ~~in,~~market ~~our IDWE~~ and ~~IDWP businesses and operations.~~ ~~While~~non-direct ~~our~~market ~~Chairman~~publications ~~of the Board has previously provided us with financing on favorable terms~~ and ~~conditions, there is no guarantee that we will be able to secure~~ such ~~financing~~dependence ~~from~~subjects ~~our~~IDWP ~~Chairman of the Board in the future on favorable terms or at all. The time required for us~~ to ~~become profitable is uncertain, and there can be no assurance that we will obtain~~ the ~~financing~~risk ~~required or achieve profitability on a sustained basis, if at all. We expect~~ that ~~our~~such ~~results~~distributor ~~of operations~~ may ~~also~~be ~~fluctuate~~unable ~~significantly in the future as a result of a variety of factors, including, without limitation: the impact of the COVID-19 pandemic, the ability~~ to ~~sell~~perform ~~comic~~its ~~books, graphic~~obligations ~~novels, television and other media related sales~~ to minimize the lag from negotiations to then sell in various theatre forms as noted above with a quick enough turn around rate to establish profitability ; our ability to attract, retain and motivate qualified personnel; specific economic conditions in the entertainment and publishing markets; and general economic conditionsIDWP.

Risks Related to IDWP

IDWP will depend on one main distributor for its direct market and non-direct market publications commencing June 2022 and such dependence subjects IDWP to the risk that such distributor may be unable to perform their obligations to IDWP.

Historically, IDWP depended on Diamond Comic Distributors, Inc., or Diamond, and Penguin Random House Publisher Services, or Penguin Random House, to distribute the vast majority of its publications. Diamond, which handles the vast majority of all comic book publishers’ direct market (i.e., comic book stores) distribution, distributes all of IDWP’s products for the direct market. As a result of the COVID-19 pandemic, IDWP offered full returns in the direct market through Diamond on comic titles through the end of February 2021 and limited returns through May 2021. Effective at the end of May 2021, the return policies have reverted back to pre-pandemic. While this is designed to reduce inventory risk for retailers, there is a possibility the marketplace could experience an irrecoverable downward trend that may trigger higher returns in a given month or quarter.

Penguin Random House distributes substantially all of IDWP’s products to non-direct market accounts (i.e., bookstores, libraries, mass market) and commencing in June 2022 will distribute to all of IDWP’s direct market accounts. Should either Diamond (until June 2022) or Penguin Random House fail to perform under the applicable distribution agreement or if either company were to experience financial difficulties that would hinder performance, distribution to the direct or non-direct market, respectively, would be significantly impaired in the short term, and IDWP’s ability to distribute and receive proceeds from its publications would be impaired which would have a material adverse impact on our business and financial results. In the first six weeks of the COVID-19 pandemic in 2020, Diamond temporarily ceased distributing IDWP’s comic books but has since resumed distribution.

The inability or unwillingness of either Diamond or Penguin Random House to perform its distribution obligations to IDWP could have a material adverse effect on IDWP’s business, prospects and financial condition.

Historically, IDWP depended on Diamond and Penguin Random House to distribute the vast majority of its publications. Commencing in June 2022, Penguin Random House will serve as IDWP’s main distributor. The loss by IDWP of Penguin Random House as a distributor of its publications could have a material adverse effect on IDWP’s business, prospects and financial condition..

IDWP may not be able to respond to changing consumer preferences and its sales may decline.

IDWP operates in highly competitive markets that are subject to rapid change, including changes in customer preferences. There are substantial uncertainties associated with IDWP’s efforts to develop successful publications and products for its customers. New fads, trends, and shifts in popular culture could affect the type of creative media consumers will purchase. Content in which IDWP has invested significant resources may fail to attract significant consumer demand at the time it is published. IDWP regularly makes significant investments in new products that may not be profitable, or whose profitability may be significantly lower than IDWP has experienced historically. A loss in sales due to the foregoing could have a material adverse effect on IDWP’s business, prospects and financial condition.

Significant returns of IDWP products sold to mass market stores may have a material impact on IDWP’s cash flow.

Through its distribution arrangement with Penguin Random House, IDWP sells its publications to bookstores, such as Barnes & Noble, on a fully returnable basis and IDW Games sold its products to mass market stores, such as Target. As a result, these customers can return publications to Penguin Random House or to game distributors for credit, which in turn is charged back to IDWP. There is no time limit on the customers’ right to return publications distributed to them. In addition to IDWP being charged back the wholesale cost of the publications, IDWP also incurs a return processing fee by Penguin Random House. Such returns and fees are credited against IDWP’s current sales revenue from Penguin Random House, which reduces IDWP’s cash flow and operating capital. Product returns are a normal part of book and games publishing and IDWP estimates and records a reserve for such returns based on its return history and current trends that are expected to continue. A significant over-estimation of demand for a publication by the mass market bookstores, however, could result in a larger-than-expected volume of returns that would significantly reduce IDWP’s cash flows and operating capital. Further, a general downturn in the economy may also result in significant returns as bookstores reduce their outstanding debts to improve their own cash flow. Any or all of these events that result in significant returns in excess of IDWP’s estimates could have a material adverse effect on IDWP’s revenue, cash flow and operating results.

IDWP’s publications may be less successful than anticipated.

IDWP cannot accurately predict the commercial success of any of its publications or games because the revenue derived from the distribution of a publication or game depends primarily upon its acceptance by the public, which cannot be accurately predicted. The commercial success of a publication also depends upon the public’s acceptance of competing publications, critical reviews, the availability of alternative forms of entertainment and leisure time activities, piracy and unauthorized distribution of publications, general economic conditions, and other tangible and intangible factors, none of which can be predicted with certainty. Additionally, if the movies or television programs that IDWP licenses are not successful, or if the characters that IDWP licenses lose some of their popularity, IDWP’s ability to sell publications based on such characters would decline, which could have a material adverse effect on IDWP’s business, prospects and financial condition.

If IDWP fails to maintain positive relationships with its key licensors, authors, illustrators and other creative talent, as well as to develop relationships with new licensors and creative talent, its business could be adversely affected.

IDWP’s business is highly dependent on maintaining strong relationships with the entertainment companies that license their entertainment properties to IDWP, and with authors, illustrators and other creative talent who produce the products that are sold to IDWP’s customers. Any weakening of these relationships, or the failure to develop successful new relationships, could have an adverse impact on IDWP’s business and financial performance. IDWP depends on freelance creators who choose how to spend their time and utilize their talents. It is important for IDWP to maintain strong relationships with those freelance creators so they devote their time and talent to IDWP’s projects. IDWP’s inability to maintain and secure these relationships could have a material adverse effect on IDWP’s business, prospects and financial condition.

IDWP cannot control certain publication delays, cancellations and shipping delays which could adversely affect IDWP’s sales and its ability to meet delivery obligations.

~~IDWP~~ IDWE does not control the ~~decision~~decisions to ~~proceed~~produce ~~with~~shows ~~the~~and ~~production~~relies ~~of publications based~~ on ~~characters~~outside ~~that~~streamers/studios itfor ~~licenses from others~~greenlighting, and ~~it does~~if ~~not~~an ~~have~~insufficient ~~full~~number ~~control~~ of ~~the~~our ~~timing of the releases of those publications, which~~ properties are ~~often~~put ~~the~~into ~~subject to long and inflexible schedules. Disruptions~~production, ~~delays~~our orprofitability ~~cancellations~~will tobe ~~those~~significantly schedules (especially those connected to Covid-19-related supply and logistics issues) could cause IDWP to incur additional costs, miss an anticipated publication date, endure long periods without publishing a publication or all of the above, which could hurt IDWP’s associated licensing programs and businessimpacted.

~~IDWP~~Reduction ~~cannot~~in ~~control~~budgets for ~~the~~content ~~increased~~could ~~industry costs~~impact inour ~~shipping,~~ability ~~printing~~to ~~and~~sell ~~paper~~television shows which incould ~~turn~~materially impact ~~profitability.~~revenue and operating results at IDWE.

Since 2020 the cost of shipping internationally has increased more than 50% above the long-term trend, established since the last recession in 2004, and is expected to continue to rise through 2022. Prices are expected to stabilize in 2023, but at a higher rate than previously seen in the industry. The price of a shipping container rose from $1400 in March 2020 to over $11,000 in September 2021. The strong demand for consumer goods is clogging transportation networks worldwide leading to the increased costs to ship internationally. Additionally, once on US soil the goods are subject to increased rail or trucking costs, roughly 23% over 2020. Increased capacity allows transporters to have leverage to continue to increase prices when negotiating contracts, affecting not only trucks and rail, but also seeping into warehouse costs as the supply-chain bottlenecks continue to squeeze capacity.

IDWP depends on the internal controls of its distributors for its financial reporting and revenues.

Because of Diamond’s and Penguin Random House’s role as distributors of IDWP’s publications and the fact that much of IDWP’s inventory is held at its distributors’ facilities, IDWP depends on the distributors to implement internal controls over financial reporting and to provide IDWP with information related to those internal controls. Diamond’s and Penguin Random House’s internal controls might not be sufficient to allow IDWP to meet its internal control obligations or to allow IDWP’s management to properly assess those controls. The distributors may fail to cure any internal control deficiencies related to the publications that it distributes. IDWP may be unable to effectively create compensating controls to detect and prevent errors or irregularities in the distributors’ accounting to IDWP and others. Errors in properly tracking publication sales could also negatively impact IDWP’s revenues.

Any loss of key personnel and the inability to attract and retain qualified employees could have a material adverse impact on IDWP’s operations.

IDWP is dependent on the continued services of key executives such as Publisher, Nachie Marsham. The departure of key personnel without adequate replacement could severely disrupt IDWP’s business operations. Additionally, IDWP needs qualified managers and skilled employees with industry experience to operate its businesses successfully. From time to time there may be shortages of skilled labor which may make it more difficult and expensive for IDWP to attract and retain qualified employees. If IDWP is unable to attract and retain qualified individuals or its costs to do so increase significantly, its operations would be materially adversely affected.

IDWP might lose sales and revenue because of piracy of publications.

With technological advances, the piracy of publications has increased. Unauthorized and pirated copies of IDWP’s publications will reduce the revenue generated by those publications. If consumers can obtain illegal copies of IDWP’s publications and media, IDWP’s revenues will decline. IDWP may not be able to identify or enforce violations of its intellectual property rights and even if legal remedies are available, they could be costly and drain its financial resources. Accordingly, illegal copying of IDWP’s content could negatively affect its revenues and earnings.

IDWP’s dependence on printers outside the United States subjects it to the risks of international business.

IDWP’s publications are printed primarily outside the United States in South Korea, China and Canada. International manufacturing is subject to a number of risks, including fluctuations and volatility in currency exchange rates, transportation delays and interruptions, political and economic disruptions, the impositions of tariffs, import and export controls and changes in governmental policies. The impact of changes in currency rates has been especially heightened by current global economic conditions and significant devaluations of local currencies in comparison to the U.S. Dollar. Although to date, currency fluctuations have not materially adversely affected IDWP’s costs, such fluctuations could materially and adversely affect IDWP in the future. Further, added tariffs may be imposed on our printing activities outside the United States which could increase IDWP’s costs. Possible increases in costs and delays of, or interferences with, product deliveries could result in losses of revenues, higher costs, reduced profitability and reductions in the goodwill of IDWP’s customers. Additional factors that may adversely affect IDWP’s printing activities outside of the United States and therefore materially and adversely affect the business and financial results of IDWP include international political situations, uncertain legal systems and applications of law, prejudice against foreigners, corrupt practices, uncertain economic policies and potential political and economic instability that may be exacerbated in foreign countries.

The competitive pressures IDWP faces in its business could adversely affect its financial performance and growth prospects.

IDWP is subject to significant competition, including from other publishers, many of which are substantially larger than IDWP and have much greater resources than it, such as Marvel Comics and DC Comics. To the extent IDWP cannot meet the challenges from existing or new competitors or develop new product offerings to meet customer preferences or needs, its revenues and profitability could be materially and adversely affected.

Risks Related to IDWE

The public health risk of COVID-19 and its impact on productions could adversely affect IDWE’s business.

Multiple television productions of IDWE have been delayed due to the COVD-19 pandemic. Live-action shows must be filmed and shot at locations with a sizeable crew. Given the public health risk of COVID-19 and related possible local, state and federal guidelines limiting the filming and production of our live-action shows, IDWE could be adversely affected and experience significant production delays or cancellations. Production costs of IDWE shows may also rise as additional safety protocols related to the COVID-19 pandemic are necessary on the set of these shows.

Increased costs for programming and other rights, as well as judgments we make on the potential performance of IDWE’s content, may adversely affect IDWE’s profits and balance sheet.

IDWE has produced a significant amount of original programming and other content and is continuing to invest in this area. IDWE’s core business involves the development and production of television shows and feature films, the costs of which are significant and involve complex negotiations with numerous third parties. Network buyers and larger studios are also continuing to drive up the cost of talent and in many cases, locking them to overall deals, which leaves IDWE with less access to high-level writers at a much higher cost of entry. These higher costs may not be recouped when the content is broadcast or distributed, and higher costs may lead to decreased profitability, losses or potential write-downs. Unfavorable currency rates both in the production and sale of television shows or feature films may also lead to increased costs. Further, rapid changes in consumer behavior have increased the risk associated with acquired programming, which typically is acquired pursuant to multi-year agreements.

We may not have sufficient capital to finance or co-finance future television shows or feature films.

With a limited annual development budget and the goal to be profitable, IDWE has evolved its strategy to not fully fund or finance the productions of television shows or feature films. While the business model of fully funding these productions can present significant upside, it is also a major risk. That being said, as a result of being more cost conscious, IDWE’s capital it spends on developing properties for media opportunities could ultimately be exhausted in any given year due to rising costs of talent and rights. As a result, IDWE might find itself in a position where it is unable to fund additional development or secure the talent required to take a project forward, and adversely affect its ability to build a significant slate of opportunities for sales to buyers.

Any loss of key personnel and the inability to attract and retain qualified employees could have a material adverse impact on IDWE’s operations.

IDWE is dependent on the continued services of key personnel with in-depth industry experience. The departure of key personnel without adequate replacement or temporary skilled coverage could severely disrupt IDWE’s business operations. Additionally, IDWE needs qualified managers and skilled employees with in-depth industry experience to operate its businesses successfully. From time to time there may be shortages of skilled labor which may make it more difficult and expensive for IDWE to attract and retain qualified employees. If IDWE is unable to attract and retain qualified individuals or its costs to do so increase significantly, its operations would be materially adversely affected.

The competitive pressures IDWE faces in its business could adversely affect its financial performance and growth prospects.

IDWE is subject to significant competition, including from other studios/producers/distributors many of which operate with significantly larger staffs and funding than IDWE. Competitors include (i) smaller independent studios such as Entertainment One, Blumhouse, iTV, Annapurna and Miramax, (ii) major independent studios such as Sony TV and Warner Bros TV, (iii) vertically integrated studios such as Twentieth Television, Universal TV, CBS TV Studios and ABC Studios who develop, distribute and produce original television programming and; (iv) other entertainment divisions of comic book or graphic novel publishers such as Dark Horse, Oni Press, Image and Boom who develop and produce TV and Film based on their publishing company’s slate of IP. To the extent IDWE cannot meet the challenges from existing or new competitors or develop new product offerings to meet customer preferences or needs, its revenues and profitability could be adversely affected.

Risks Related to Our Intellectual Property

The success of our businesses is highly dependent on the existence and maintenance of intellectual property rights in the publishing and entertainment products and services we create.

The value to us of our intellectual property rights is dependent on the scope and duration of our rights as defined by applicable laws in the United States and abroad and the manner in which those laws are construed. If those laws are drafted or interpreted in ways that limit the extent or duration of our rights, or if existing laws are changed, our ability to generate revenue from our intellectual property may decrease, or the cost of obtaining and maintaining rights may increase.

The unauthorized use of our intellectual property may increase the cost of protecting rights in our intellectual property or reduce our revenues. The unauthorized distribution and access to content generally continues to be a significant challenge for intellectual property rights holders. Inadequate laws or weak enforcement mechanisms to protect entertainment industry intellectual property in one country can adversely affect the results of the Company’s operations worldwide, despite the Company’s efforts to protect its intellectual property rights. COVID-19 may increase incentives and opportunities to access content in unauthorized ways, as negative economic conditions coupled with a shift in government priorities could lead to less enforcement. These developments may require us to devote substantial resources to protecting our intellectual property against unlicensed use and present the risk of increased losses of revenue as a result of unlicensed distribution of our content.

With respect to intellectual property developed by us and rights acquired by us from others, we are subject to the risk of challenges to our copyright, trademark and patent rights by third parties. Successful challenges to our rights in intellectual property may result in increased costs for obtaining rights or the loss of the opportunity to earn revenue from the intellectual property that is the subject of challenged rights.

Our intellectual property rights may not be protected, which could adversely affect our consolidated financial position and results of operations.

A substantial portion of our publications are protected by copyright, held either in our name, in the name of the author of the work, or in the name of a sponsoring professional society. Such copyrights protect our exclusive right to publish the work in many countries abroad for specified periods. Our ability to continue to achieve our expected results depends, in part, upon our ability to protect our intellectual property rights. Our consolidated financial position and results of operations may be adversely affected by lack of legal and/or technological protections for our intellectual property in some jurisdictions and markets.

Failure to adequately protect and enforce our intellectual property rights could substantially harm our business and operating results.

The success of our business depends in part on our ability to protect and enforce our trademarks, copyrights, trade secrets and other intellectual property rights. We attempt to protect our intellectual property under trademark, copyright and trade secret laws, and through a combination of confidentiality procedures, contractual provisions and other methods, all of which offer only limited protection.

From time to time, legal action by us may be necessary to enforce our trademarks and other intellectual property rights, to protect our trade secrets, to determine the validity and scope of the intellectual property rights of others or to defend against claims of infringement or invalidity. Such litigation could result in substantial costs and diversion of resources, distract management and technical personnel and negatively affect our business, operating results and financial condition. If we are unable to protect our intellectual property rights, we may find ourselves at a competitive disadvantage to others who need not incur the additional expense, time and effort required to create the innovative products that have enabled us to be successful to date. Any inability on our part to protect adequately our intellectual property may have a material adverse effect on our business, operating results and financial condition.

Risk Factors Generally Relating to Us and Our Class B Common Stock

There can be no assurances that our Class B common stock will not be subject to potential delisting if we do not continue to maintain the listing requirements of the NYSE American.

We are subject to, among other things, our fulfilling all of the listing requirements of NYSE American. In addition, NYSE American has rules for continued listing, including, without limitation, minimum market capitalization and other requirements. Failure to maintain our listing (i.e., being de-listed from NYSE American), would make it more difficult for stockholders to sell our Class B common stock and more difficult to obtain accurate price quotations on our Class B common stock. This could have an adverse effect on the price of our Class B common stock. Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our Class B common stock is not traded on a national securities exchange.ii

13Part I

~~Although we~~As doused ~~not~~in ~~intend~~this toAnnual ~~utilize~~Report, unless the context otherwise requires, the terms the “~~controlled~~Company,” ~~company~~“IDW Media Holdings,” ~~exemption~~“we,” ~~that~~“us,” and ~~may~~“our” ~~now~~refer orto inIDW ~~the~~Media ~~future~~Holdings, beInc., ~~afforded~~a toDelaware uscorporation, byand ~~the~~its ~~NYSE American~~subsidiaries, wecollectively. ~~may~~Each doreference soto a fiscal year in this Annual Report refers to the ~~future~~fiscal ~~which~~year ~~could~~ending ~~limit~~in orthe ~~reduce~~calendar year indicated (for example, fiscal 2022 refers to the ~~effectiveness~~fiscal ofyear ~~our~~ended ~~corporate~~October 31, ~~governance~~2022).

~~The~~Item ~~Trusts (as defined below) collectively hold shares that represent approximately 61~~1.0% ~~of the combined voting power of our outstanding stock as of January 14, 2022~~Business. See “Eight trusts for the benefit of sons and daughters of Howard S. Jonas, our Chairman of the Board of Directors, hold shares that, in the aggregate, represent more than a majority of the combined voting power of our outstanding capital stock, which may limit the ability of other stockholders to affect our management”, below, and “Holders of our Class B common stock have significantly less voting power than holders of our Class C common stock”, below.

Although we do not believe it to be the case currently, as a result of our current ownership by the Trusts or otherwise we may now or in the future qualify for the exceptions from the NYSE American’s corporate governance listing requirements available to us because we are a “controlled company” as defined in section 801(a) of the NYSE American Company Guide. Among other things, a “controlled company” may exempt itself from the requirement that (i) a majority of its directors be independent directors, (ii) its Compensation Committee, Corporate Governance Committee and/or Nominating Committee be comprised entirely of independent directors, and (iii) the Company not have a single Nominating/Corporate Governance Committee.OVERVIEW

~~If we~~We ~~currently~~were orincorporated in the ~~future~~State ~~qualify~~of ~~as a “controlled company,” we do not intend to rely on any applicable exceptions from~~Delaware ~~the NYSE American’s corporate governance listing requirements available to us because we are at that time a “controlled company.” However, there can be no assurance that we will not~~ in ~~the~~May future, if at that time we are a “controlled company,” rely on any or all of the exceptions from the NYSE American’s corporate governance listing requirements available to us because we are a “controlled company2009.” If we do rely on any or all of the exceptions from the NYSE American’s corporate governance listing requirements because we are then a “controlled company,” the effectiveness of our corporate governance could be limited or reduced.

~~Our multi-class~~In ~~structure~~2009, ~~may~~IDT ~~render~~Corporation, our ~~shares~~former ~~ineligible~~parent ~~for~~corporation, completed ~~inclusion~~a intax-free ~~certain~~spinoff ~~stock~~of ~~market~~the ~~indices,~~Company ~~and~~through ~~thus~~a ~~adversely~~pro ~~affect~~rata ~~the~~distribution ~~share price~~ of our ~~Class B~~ common stock ~~and~~to ~~its~~IDT’s ~~liquidity~~stockholders.

~~We have issued and outstanding shares of Class B common stock and shares of Class C common stock.~~ Our ~~multi-class~~principal ~~structure~~businesses ~~may render our shares ineligible for inclusion in certain stock market indices, which may adversely affect the share price of our Class B common stock and its liquidity.~~include:

~~There is~~● aIDW ~~limited~~Publishing ~~trading~~(“IDWP”), ~~market~~a ~~for~~publishing ~~shares~~company ofthat ~~our~~creates ~~Class~~comic Bbooks, ~~common~~graphic ~~stock~~novels and ~~stockholders~~digital ~~may~~content ~~find~~through itits ~~difficult~~imprints toIDW, ~~sell~~Top ~~our~~Shelf ~~shares.~~Productions and Artist’s Editions; and

~~Our Class~~● BIDW ~~common~~Entertainment stock may be subject to the penny stock rules that impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and accredited investors. The SEC regulations generally define a penny stock to be an equity that has a market price of less than $5.00 per share(“IDWE”), ~~subject to certain exceptions. If we do not retain~~ a ~~listing on~~production ~~NYSE~~company ~~American~~ and ifstudio ~~the~~that ~~price of our Class B common stock is less than $5.00~~develops, ~~our~~produces Class B common stock will be deemed a penny stock. Unless an exception is available, those regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and ~~the~~distributes ~~risks~~content ~~associated~~based ~~therewith and impose various sales practice requirements~~ on ~~broker-dealers who~~IDWP’s ~~sell~~original, ~~penny~~copyrighted ~~stocks~~intellectual toproperty ~~persons other than established customers and accredited investors~~ (~~generally institutions and high net worth individuals~~“IP”)~~. In addition~~, ~~the~~published ~~broker-dealer~~in ~~must provide~~ the ~~customer~~form ~~with~~of ~~current~~comic ~~bid and offer quotations for the penny stock~~books, ~~the compensation~~graphic ofnovels ~~the broker-dealer~~ and ~~its~~any ~~salesperson~~other informs ~~the transaction and monthly account statements showing the market value~~ of ~~each penny~~print ~~stock held in the customer’s account. Moreover~~publication, ~~broker-dealers~~for ~~who recommend such securities to persons other than established customers and accredited investors must make~~ a ~~special~~variety ~~written suitability determination for the purchaser and receive the purchaser’s written agreement to transactions prior to sale. Regulations on penny stocks could limit the ability~~ of ~~broker-dealers~~formats toincluding ~~sell~~film ~~our Class B common stock~~ and ~~thus the ability of purchasers of our Class B common stock to sell their shares in the secondary market~~television.

~~We cannot~~IDWP ~~predict~~is ~~the~~an ~~extent~~award-winning topublisher ~~which~~of ~~investor~~comic ~~interest~~books, original ingraphic usnovels, and ~~our~~art ~~Class~~books. BFounded ~~common~~in ~~stock~~1999, ~~will~~IDWP ~~lead~~has toa ~~the~~long ~~development~~tradition ~~or continuance~~ of an ~~active~~supporting ~~trading~~original, ~~market~~powerful orcreator-driven ~~how~~titles. In ~~liquid~~2002, ~~that~~IDWP ~~trading~~published 30 ~~market~~Days ~~for~~of ~~our~~Night by ~~Class~~Steve BNiles ~~common~~and ~~stock~~Ben ~~might~~Templesmith ~~become.~~followed Ifby another ~~active~~horror ~~trading~~titles ~~market~~that ~~for~~helped ~~our~~kickstart ~~Class~~a Bresurgence ~~common~~in ~~stock~~horror-comic ~~does~~publishing ~~not~~across ~~develop~~the orindustry. isSince ~~not sustained~~then, itIDWP ~~may~~has besignificantly ~~difficult~~diversified ~~for~~its ~~investors~~publications. Joe toHill ~~sell~~and ~~shares,~~Gabriel ~~particularly~~Rodríguez’s Locke ~~large~~& ~~quantities~~Key, of ~~our~~Scott ~~Class~~Snyder’s BDark ~~common~~Spaces ~~stock~~line, atStephen aGraham Jones’s ~~price~~Earthdivers, ~~that~~Beau isSmith’s Wynonna ~~attractive or at all. As a result~~Earp, anAlan ~~investment~~Robert’s The inBeauty ~~our~~of ~~Class~~Horror adult coloring Bbooks, ~~common~~and ~~stock may~~Darwyn beCooke’s ~~illiquid~~graphic ~~and~~novel ~~investors~~adaptations ~~may~~of ~~not~~Richard beStark’s Parker novels ~~able~~are tojust ~~liquidate~~a few ~~their~~of ~~investment~~the ~~readily~~hundreds orof ataward-winning ~~all~~titles ~~when~~published ~~they~~since ~~desire~~IDWP’s ~~to sell~~inception.

~~There~~IDWE leverages IDWP original isIP ~~limited~~into ~~liquidity~~television inseries, ~~our~~features, ~~Class~~and Bother ~~common~~forms ~~stock,~~of ~~which~~media ~~may~~by ~~adversely~~developing ~~affect~~and ~~your~~producing ~~ability~~original tocontent. ~~sell~~IDWE ~~your~~maintains ~~shares~~a development slate of ~~our~~properties ~~Class~~based Bon ~~common~~IDWP ~~stock~~properties for the adult series/features marketplace and the kids, family, and animation spaces.

~~The~~Prior to February 15, 2021, we also owned CTM ~~market~~Media ~~price~~Group (“CTM”), a company that develops and distributes print and digital-based advertising and information advertising for tourist destinations in targeted tourist markets in 32 states / provinces in the United States and Canada. On February 15, 2021 (“CTM Sale Date”), we consummated the sale of ~~our~~CTM ~~Class~~to Ban ~~common~~entity ~~stock~~associated ~~may~~with ~~fluctuate~~Howard ~~significantly~~Jonas, our Chairman and Chairman of the Board, in exchange ~~response~~for (i) the cancelation of $3.75 million of indebtedness the Company owed to Mr. Jonas’ designee, (ii) a ~~number~~contingent payment of ~~factors,~~up ~~some~~to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the sale (which ~~are~~condition ~~beyond~~was ~~our~~not met), and (iii) a contingent payment if CTM is sold within 36 months of the sale for more ~~control~~than $4.5 ~~These~~million ~~factors~~(“CTM ~~include~~Sale”). As of July 31, ~~but~~2020, ~~are~~CTM ~~not~~was ~~limited~~reported ~~to:~~as a discontinued operation and CTM’s operations has since been included in the consolidated financial statements as discontinued operations. As of October 31, 2022, the 18-month period for the contingent payment based upon recovery of quarterly revenue has lapsed and no payment is owed.

●Financial ~~developments~~information ~~concerning~~by ~~intellectual~~segment ~~property~~is ~~rights~~presented in ~~and~~Note ~~regulatory~~5 ~~approvals~~in ~~relating~~the Notes to ~~us;~~our Consolidated Financial Statements in Item 8 of this Annual Report.

●Our ~~quarterly~~headquarters ~~variations~~are inlocated ~~our~~at ~~business~~520 ~~and~~Broad ~~financial~~Street, Newark, ~~results~~New orJersey ~~the~~07102. ~~business~~The ~~and~~main ~~financial~~telephone ~~results~~number ofat our ~~competitors;~~headquarters is (323) 433-6670 and our corporate web site’s home page is www.idwmediaholdings.com.

141

●We ~~the~~make ~~ability~~available orfree ~~inability~~ of uscharge toour ~~generate~~Annual ~~increases~~Report on inForm ~~revenue~~10-K, ~~and~~quarterly ~~profit;~~reports ●on ~~the~~Form ~~ability~~10-Q, orcurrent ~~inability~~reports ofon usForm 8-K and all amendments to ~~raise~~these ~~capital~~reports, and all beneficial ownership reports on Forms 3, 4 and 5 filed by directors, officers and beneficial owners of more than 10% of our equity through the ~~terms~~investor relations page of our web site (https://idwmediaholdings.com/investors/) as soon as reasonably practicable after such material is electronically filed with the Securities and ~~conditions~~Exchange ~~associated~~Commission. Our web site also contains information not incorporated into this Annual Report on Form 10-K or our other filings with ~~any~~the ~~such~~Securities ~~raising~~and ofExchange ~~capital;~~Commission.

●Recent ~~developments~~Developments ~~in our industry and target markets;~~

●In ~~the~~December ~~number~~2022, ofIDWE ~~market~~announced ~~makers~~that ~~who~~the ~~are~~Top Shelf ~~willing~~graphic tonovel ~~continue~~“A toRadical ~~make~~Shift aof ~~market~~Gravity” had inbeen ~~our~~optioned ~~stock~~by ~~and~~Hidden ~~the~~Pictures ~~market~~(which orhas ~~exchange~~a onfinancing ~~which~~partnership ~~they~~with ~~decide~~Lionsgate) to ~~make~~turn it into a ~~market~~feature infilm. ~~our~~In ~~stock;~~addition, we announced that Oscar-nominated screenwriter Matt Charman (Bridge of Spies) would pen the adaptation.

●In ~~our~~November ~~ability~~2022, IDWE announced that creative talent and show runners had been attached to ~~have~~six of our ~~Class~~books Bin ~~common~~order ~~stock~~to ~~listed~~develop onthem into television projects. Once development is complete, IDWE will take the ~~NYSE~~projects ~~American;~~to buyers in the hopes of getting them optioned and greenlit. The series in development include Bacchus, Dragon Puncher & Spoony, Korgi, Lodger, Relic of the Dragon and Satellite Falling. Talent attached includes Will Davis (Lyle, Lyle Crocodile, Man v. Bee), Holly Huckins (Recess, Angela Anaconda), Aury Wallington (Veronica Mars, Heroes, Gravity Falls), Max & Adam Reid (Aeon Flux, Sneaky Pete), Will Pascoe (Orphan Black) and Directors Jude Weng (Only Murders in the Building, Finding Ohana) and Patricia Riggen (The 33).

●On ~~general~~August ~~market~~30, ~~conditions~~2022, we announced our first co-development deal with writing team Matt Silverstein and ~~other~~Dave ~~factors,~~Jeser ~~including~~for ~~factors~~the ~~unrelated~~development toand ~~our~~production ~~own~~of ~~operating~~the ~~performance~~sci-fi comedy “Family Time” into a television series and original comic book property.

~~In recent~~Starting ~~years, the stock market~~ in ~~general~~July ~~has~~2022, ~~experienced~~we ~~extreme~~announced ~~price and volume fluctuations. Continued market fluctuations could~~the ~~result~~publishing inplans ~~extreme~~for ~~volatility in~~ the ~~price~~following oforiginal ~~shares~~projects: ofDark ~~our~~Spaces: ~~Class~~Wildfire, BTrve ~~common~~Kvlt, ~~stock~~Crashing, ~~which~~Dead ~~could~~Seas, ~~cause a decline in the value of our shares.~~Golgotha ~~Price~~Motor ~~volatility may be accentuated if trading volume of our Class B common stock is low~~Mountain, ~~which~~Arca ~~historically~~and ~~has~~The ~~often~~Hunger ~~been~~and the ~~case. The volatility~~Dusk, innew ~~our~~original ~~Class~~projects Bthat ~~stock~~draw ~~may~~from bea ~~combined~~wide ~~with~~selection ~~low trading volume. Any or all~~ of ~~these above factors could adversely~~genres ~~affect~~including ~~your~~crime ~~ability~~thrillers, tosupernatural ~~sell your shares of our Class B common stock or~~horror, ifscience ~~you are able to sell your shares~~fiction, toand ~~sell~~epic ~~your shares at a price that you determine to be fair or favorable~~fantasy.

WeIDWE recently announced a slate of six additional titles with closed ~~have~~development nodeals ~~future~~with ~~plans~~major studios, streamers, and distributors and an animated series with Cartoon Network. As a part of these deals, IDWE will work closely to ~~pay~~develop ~~dividends~~these onproperties ~~our~~as ~~Class~~narrative Btelevision ~~common~~series, ~~stock~~with the ultimate goal of securing a greenlight to production. There will be little to no material financial benefit generated from a project until a property is in production.

~~We do~~These ~~not~~titles pay, and do not intend to pay, cash dividends on our Class B common stock. We currently intend to retain all available funds and any future earnings for use in the operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. In addition, the terms of our current, as well as any future, financing agreements may preclude us from paying any dividends. As a result, capital appreciation, if any, of our Class B common stock will be investors’ sole source of potential gain for the foreseeable future.include:

~~We are~~● aDark ~~“smaller~~Spaces ~~reporting~~with ~~company”~~Universal ~~and~~Cable anProductions (“~~emerging growth company~~UCP” ~~and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies and emerging growth companies will make our Class B common stock less attractive to investors.~~);

~~We are~~● aEarthdivers “smaller reporting company,” as defined in Rule 12b-2 under the Exchange Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including “emerging growth companies” such as, but not limited to, not being required to comply with ~~the~~20th ~~auditor~~Television ~~attestation~~Studios ~~requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports~~ and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Our status as a “smaller reporting company” is determined on an annual basis. We cannot predict if investors will find our Class B common stock less attractive or our company less comparable to certain other public companies because we will rely on these exemptions. For example, if we do not adopt a new or revised accounting standard, our future financial results may not be as comparable to the financial results of certain other companies in our industry that adopted such standards. If some investors find our Class B common stock less attractive as a result, there may be a less active trading market for our Class B common stock and our stock price may be more volatile.Hulu;

~~If we~~● ~~fail~~Ballad tofor ~~implement~~Sophie ~~and~~with ~~maintain~~Universal anTelevision ~~effective system of internal controls, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud.~~ International;

~~Under Section 404~~● ofThe ~~the~~Delicacy ~~Sarbanes-Oxley Act of 2002, a newly public company is not required to comply~~ with ~~either~~Warner ~~the~~Bros. ~~management~~Television ~~or the auditor reporting requirements related to internal control over financial reporting until its second annual report, if applicable.~~Studios;

~~Further, we~~● ~~intend~~Brutal toNature ~~qualify~~with asleading anMexico-based ~~“emerging~~animation ~~growth~~studio ~~company”~~Anima asStudios; ~~defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of reduced reporting~~ and ~~other burdens that are otherwise applicable generally to public companies. These provisions include:~~

● anA ~~extended~~Radical ~~transition~~Shift ~~period~~of toGravity ~~comply~~ with ~~new~~award orwinning ~~revised~~film ~~accounting~~producer ~~standards~~Todd ~~applicable~~Lieberman/Hidden toPictures ~~public companies;~~ and Lionsgate

~~● an exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002.~~2

15COVID-19: Overview of Impacts

We may take advantage of these provisions until the end of our fiscal year 2026, or such earlier time that we are no longer an emerging growth company and, if we do, the information that we provide stockholders may be different than you might receive from other public companies in which you hold equity. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, have more than $700 million in market value of our shares of common stock held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period.

●	IDW Media Holdings: In connection with the novel coronavirus (“COVID-19”) pandemic, we received two loans under the Paycheck Protection Program (“PPP”) related to core IDWE and IDWP operations.

		o $1,196,000 on April 27, 2020, subsequently forgiven on July 20, 2021

		o $1,196,000 on April 2, 2021, subsequently forgiven on October 27, 2021
●	IDWP: Issues primarily related to the COVID-19 pandemic continue to impact international printing and shipping. Costs are beginning to level off as of the end of fiscal 2022 and the strain on the logistics network is easing, but prices and timing are still considerably higher than the pre-pandemic levels.

●	IDWE: Industry-wide production suspensions halted filming and production of Wynonna Earp Season four after the completion of six of twelve episodes and the remaining six were subsequently completed and released. Despite a less impactful COVID-19, IDWE continues its program to develop, package and pitch from its library, adapting to a new marketplace that exists as a hybrid in office/remote model. While there are some in-person writer’s rooms with strict COVID-19 protocols, the majority of writer’s rooms, pitch scenarios and development conversations are all still happening remotely, with little to no impact on filming and production schedules.

~~In addition,~~We ifqualified wefor nocertain tax ~~longer~~credits ~~qualify~~under asthe anCoronavirus ~~emerging growth company~~Aid, asRelief ~~an accelerated filer, our independent registered public accounting firm must attest to~~ and ~~report~~Economic onSecurities ~~the~~Act ~~effectiveness~~(“CARES ~~of our internal control over financial reporting~~Act”). ~~Our~~During ~~management~~fiscal ~~may~~2022, ~~conclude~~we ~~that~~recognized ~~our~~an ~~internal~~employee ~~control~~retention ~~over~~credit ~~financial~~(“ERC”) ~~reporting~~for isqualified ~~not~~wages ~~effective.~~paid ~~Moreover,~~between ~~even~~January if1, ~~our~~2021 ~~management~~and ~~concludes~~March ~~that our internal control over financial reporting is effective~~31, ~~our~~2021 ~~independent~~of ~~registered public accounting firm~~$564,000 ~~after~~as ~~conducting its own independent testing,~~an ~~may~~offset ~~issue~~to apayroll ~~report~~tax ~~that~~expenses iswithin ~~qualified~~selling, ifgeneral itand isadministrative ~~not~~expenses ~~satisfied~~in ~~with~~ our ~~internal~~consolidated ~~controls~~statements orof ~~the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us~~operations. InTo ~~addition, after~~ date we ~~become~~have areceived ~~public company, our reporting obligations may place~~ a ~~significant~~total ~~strain~~of ~~on our management~~$564, ~~operational and financial resources and systems for the foreseeable future~~000. ~~We may be unable to timely complete our evaluation testing and any required remediation.~~

~~During the~~Business ~~course~~Description of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404, we may identify other weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404. If we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, harm our results of operations, and lead to a decline in the trading price of our stock.

~~Additionally, ineffective~~In ~~internal~~fiscal ~~control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list~~2022, ~~regulatory~~our ~~investigations~~principal ~~and civil or criminal sanctions. We may~~businesses ~~also~~consisted ~~be required to restate our financial statements from prior periods.~~of:

~~The requirements~~● ofIDWP, ~~being~~ a ~~reporting~~publishing ~~public~~ company ~~may~~that ~~strain~~creates ~~our~~comic ~~resources~~books, ~~divert~~graphic ~~management’s~~novels ~~attention~~ and ~~affect~~digital ~~our~~content ~~ability to~~through ~~attract~~its ~~and~~imprints: ~~retain~~IDW, ~~additional~~Top ~~executive~~Shelf ~~management~~Productions and ~~qualified~~Artist’s ~~board~~Editions; ~~members.~~and

~~As a~~● ~~reporting public company~~IDWE, wea ~~will~~production becompany ~~subject~~and tostudio ~~the~~that ~~reporting requirements of the Exchange Act~~develops, ~~the~~produces ~~Sarbanes-Oxley Act,~~ and ~~the~~distributes ~~Dodd-Frank Act,~~content ~~and~~based ~~other~~on ~~applicable~~IDWP’s ~~securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs~~original, ~~making~~copyrighted ~~some activities more difficult~~IP, ~~time-consuming~~published orin ~~costly.~~the ~~This~~form ~~will~~of ~~put~~comic ~~increased~~books, ~~demand~~graphic onnovels ~~our systems~~ and ~~resources,~~ ~~particularly~~any ~~after we are no longer a “smaller reporting company.” The Exchange Act requires, among~~ other ~~things, that~~forms weof ~~file~~print ~~annual~~publication, ~~quarterly~~for ~~and~~a ~~current~~variety ~~reports with respect to our business and results~~ of ~~operations.~~formats Asincluding afilm ~~“smaller reporting company”~~ and ~~“emerging growth company”, as stated above, we receive certain reporting exemptions under The Sarbanes-Oxley Act~~television.

~~Changing laws,~~In ~~regulations~~calendar ~~and standards relating to corporate governance and public disclosure create uncertainty for public companies~~2021, ~~which increases~~the ~~legal~~Company ~~and~~wound ~~financial compliance costs and time expenditures for internal personnel. These laws, regulations and standards are~~down ~~subject~~IDW toGames ~~interpretation, which in many cases due to their lack of specificity, their application in practice may evolve over time as regulators~~ and ~~governing bodies provide new guidance. These changes may result in continued uncertainty regarding compliance matters and may necessitate higher costs due to ongoing revisions to filings~~, ~~disclosures~~going ~~and governance practices. We intend to invest resources to comply with evolving laws~~forward, ~~regulations~~IDW ~~and~~Games ~~standards,~~is ~~and~~only ~~this~~backfilling ~~investment~~final ~~may~~orders ~~result in increased general~~ and ~~administrative~~reproducing ~~expenses and~~select aexisting ~~diversion of management’s time and attention from revenue-generating activities to compliance activities~~products. If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate regulatory or legal proceedings against us and our business may be adversely affected.

16IDW Publishing

~~As a~~There ~~public~~are ~~company~~two ~~under~~primary ~~these~~sources ~~rules~~of ~~and~~the ~~regulations,~~content ~~we expect~~ that itIDWP ~~may make it more expensive for us to hire external auditors to perform requisite outside audited financial statements~~develops, ~~as well as obtain director and officer liability insurance~~publishes, ~~and we may be required~~ ~~to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult for us to attract~~ and ~~retain~~exploits ~~qualified~~across ~~members~~a ofrange ~~our board~~ of ~~directors,~~distribution ~~particularly to serve on our audit committee and compensation committee and could also make it more difficult to attract qualified executive officers.~~channels:

~~As a~~● ~~result of disclosure of information in this Prospectus and in filings required of a public company~~Original, ~~our~~creator-owned ~~business~~material ~~and~~that ~~financial~~marks ~~condition will~~its ~~become~~debut ~~more~~to visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, our business and results of operations could be adversely affected, and even if the ~~claims~~consuming dopublic ~~not~~via ~~result in~~IDWP’s ~~litigation~~published ~~or are resolved in our favor~~products, ~~these~~inclusive ~~claims, and the time and resources necessary to resolve them, could divert the resources~~ of ~~our~~IDW ~~management~~Originals and ~~adversely~~Top ~~affect~~Shelf ~~our~~(“Creator ~~business~~Content”); and ~~results of operations.~~

~~General economic~~● ~~conditions~~Third-Party ~~may~~content ~~negatively~~that ~~impact~~has already been successfully exploited in other media with partners such as Paramount (Teenage Mutant Ninja Turtles, Star Trek), Hasbro (My Little Pony, Dungeons & Dragons), Sega (Sonic) and with companies including DC Comics and Marvel on our ~~operations~~Artist’s Editions (“Licensed Content”).

~~Economic~~IDWP’s largest ~~downturns~~product ~~may~~group ~~negatively~~is ~~affect~~the ~~our~~publication ~~operations~~of comic book and trade paperback products. ~~These~~Its ~~conditions~~comics ~~may~~and begraphic ~~widespread~~novels orare ~~isolated~~primarily distributed through three channels: (i) to ~~one~~comic orbook ~~more~~specialty ~~geographic~~stores ~~regions~~(the in“direct ~~which we~~market”); ~~operate.~~(ii) ~~Higher~~to ~~wages~~traditional retail outlets, ~~related~~including ~~labor~~bookstores and ~~costs,~~mass ~~printing~~market ~~costs~~stores, ~~leasing~~on ~~costs,~~a ~~energy,~~returnable ~~insurance~~basis ~~and~~(the ~~fuel~~“non-direct ~~costs~~market”); and ~~the~~(iii) ~~increasing~~to ~~cost~~E-book distributors (“digital ~~trends~~publishers”). inIDWP’s ~~those~~publications ~~markets~~are ~~may~~widely ~~decrease~~available ~~our~~digitally ~~margins.~~through ~~Moreover,~~popular ~~economic~~distributors ~~downturns~~such ~~present~~as anComixology, ~~additional~~Amazon, Apple ~~challenge~~iBooks, toGoogle usPlay, ~~because~~Hoopla, aOverdrive, ~~significant portion~~and ofvia ~~our~~IDWP’s ~~revenues~~own ~~are~~webstore ~~from~~at ~~sales~~idwpublishing.com. ~~through~~Through ~~retail~~the ~~stores,~~direct ~~which~~market ~~are~~and ~~more~~non-direct market, ~~likely~~IDWP, toincluding ~~close~~its ~~during~~imprints ~~economic~~sold ~~downturns~~over 3.9 Inmillion ~~addition, decreases~~units in ~~travel~~fiscal 2022 and ~~entertainment~~is ~~spending~~regularly ~~during~~recognized ~~economic~~as ~~downturns~~one ~~could~~of ~~impact~~the ~~our~~nation’s largest ~~businesses,~~publishers ~~and~~in ~~thereby~~the ~~negatively~~comics ~~impact~~& ~~our operations~~graphic novels category.

~~We could find it difficult to raise additional capital in the future.~~3

~~We may~~IDWP’s ~~need~~focus tois ~~raise additional capital in order for stockholders~~ to ~~realize~~expand ~~increased~~and ~~value~~market onits library ~~our~~of ~~securities. Given the current global economy~~titles, ~~there~~from ~~can~~both becreator-owned notitles ~~assurance~~in ~~that~~our weIDW ~~would~~and beTop ~~able~~Shelf tobrands; ~~obtain~~and ~~funding~~also, ~~on commercially reasonable terms~~ in apartnership ~~timely~~with ~~fashion.~~our ~~Failure~~top-of-class licensors tounder ~~obtain~~our ~~additional~~IDW ~~funding,~~brand. ifIDWP ~~necessary,~~works ~~could~~synergistically ~~have~~with aIDWE ~~material~~to ~~adverse~~develop ~~effect~~new ontitles ~~our~~and ~~business,~~to ~~prospects~~support ~~and~~existing ~~financial condition~~titles.

~~Holders~~IDWP is an award-winning publisher of ~~our~~comic ~~Class~~books, Boriginal ~~common~~graphic ~~stock~~novels, ~~have~~and art books. Founded in 1999, IDWP has a long tradition of supporting original, powerful creator-driven titles. In 2002, IDWP published 30 Days of Night by Steve Niles and Ben Templesmith followed by other horror titles that helped kickstart a resurgence in horror-comic publishing across the industry. Since then, IDWP has significantly diversified ~~less~~its ~~voting~~publications. ~~power~~Joe ~~than~~Hill ~~holders~~and Gabriel Rodríguez’s Locke & Key, Jonathan Maberry’s V Wars, Beau Smith’s Wynonna Earp, Alan Robert’s The Beauty of ~~our~~Horror adult ~~Class~~coloring Cbooks, and ~~common~~Darwyn ~~stock~~Cooke’s graphic novel adaptations of Richard Stark’s Parker novels are just a few of the hundreds of award-winning titles published since its inception.

~~Holders of~~IDWP ~~our~~owns ~~Class~~Top BShelf ~~common~~Productions, an ~~stock~~award-winning ~~are~~critically ~~entitled~~acclaimed topublisher ~~one-tenth~~ of agraphic ~~vote~~novels. ~~per~~Top ~~share~~Shelf onProductions ~~all~~is ~~matters~~renowned onfor ~~which~~publishing ~~our~~works ~~stockholders~~of ~~are~~literary significance ~~entitled~~including tothe ~~vote, while~~#1 New ~~holders~~York ofTimes and Washington ~~our~~Post bestselling ~~Class~~trilogy, CMarch, by ~~common~~Congressman ~~stock~~John ~~are~~Lewis, ~~entitled~~Andrew toAydin, ~~three~~and ~~votes~~Nate ~~per share~~Powell. March is ~~Because of their voting power,~~ the ~~holders~~only ofgraphic ~~our~~novel ~~Class C common stock will be able~~ to ~~control~~have ~~matters~~won ~~requiring approval by our stockholders, including~~ the ~~election~~National ~~of all of the directors,~~Book ~~amendment~~Award ~~of organizational documents~~ and ~~the~~is ~~approval~~one of ~~significant~~the ~~corporate~~most ~~transactions,~~taught ~~including~~graphic ~~any~~novels ~~merger,~~in ~~consolidation~~schools. ~~or sale~~In ofJuly ~~all~~2019, orTop ~~substantially~~Shelf ~~all~~Productions ofreleased ~~our~~George ~~assets.~~Takei’s Asgraphic memoir, They aCalled ~~result~~Us Enemy, ~~the~~which ~~ability~~debuted ofat ~~any~~#2 ofon the New ~~holders~~York ofTimes Paperback ~~our~~Nonfiction ~~Class~~Best BSellers list ~~common~~and ~~stock~~as toa ~~influence our~~#1 ~~management~~bestseller ~~may~~on ~~be limited~~Amazon. InBoth ~~addition,~~titles ~~our~~are ~~dual~~now ~~class~~perennial ~~structure~~bestsellers ~~has~~and anconsidered ~~anti-takeover~~two ~~effect,~~of ~~and accordingly,~~ the ~~holders~~finest ofnon-fiction ~~the~~graphic ~~shares~~novels. ofOther ~~Class~~iconic CTop ~~common~~Shelf ~~stock~~Productions ~~have~~titles ~~the~~include ~~ability~~Kim toDwinell’s Surfside ~~prevent~~Girls, ~~any~~Jeff ~~change~~Lemire’s Essex County and The inUnderwater ~~control~~Welder, ~~transactions~~Hannah ~~that~~Templer’s Cosmoknights, ~~may~~and ~~otherwise~~Alan beMoore inand ~~the~~Eddie ~~best interest~~Campbell’s ofFrom ~~stockholders~~Hell.

~~Eight~~In addition to its ~~trusts~~core ~~for~~of creator-driven franchises, IDWP has also partnered with the ~~benefit~~owners of ~~sons~~major licensed brands to publish many successful licensed titles, including Paramount Global’s Teenage Mutant Ninja Turtles and ~~daughters~~Star ofTrek; Hasbro’s Dungeons ~~Howard~~& SDragons, and My Little Pony; Sega’s Sonic The Hedgehog; and Toho’s Godzilla. ~~Jonas,~~These ~~our~~licensed ~~Chairman~~titles ofbring ~~the~~with ~~Board~~them ofdiverse ~~Directors~~built-in audiences and build cache and retailer support for IDWP. With licensed franchises, ~~hold~~IDWP’s ~~shares~~strategy is to focus not only on licenses that, have eager, built-in ~~the~~fan ~~aggregate~~followings, but also ongoing licensor support through other channels, such as toys, animation, and film. This strategy ~~represent~~enables ~~more~~IDWP ~~than~~to aexpand ~~majority~~its ofaudience ~~the~~reach ~~combined~~and ~~voting~~to ~~power~~pursue ofsub-license ~~our~~opportunities ~~outstanding~~with ~~capital~~foreign ~~stock~~publishers. IDWP also collaborates with other comic book publishers to co-publish certain titles, ~~which~~including ~~may~~Batman ~~limit~~vs. ~~the~~Teenage ~~ability~~Mutant ofNinja ~~other~~Turtles ~~stockholders~~and Locke to& ~~affect~~Key/The ~~our~~Sandman ~~management~~Universe: Hell & Gone (with DC Comics), Rick & Morty vs. Dungeons & Dragons (with Oni Press, Inc.) and Godzilla vs. Power Rangers (with Boom Studios).

~~Eight~~IDW ~~trusts~~Originals, ~~for the benefit of sons and daughters of Howard S. Jonas~~launched ~~(the~~in ~~“Trusts”),~~July ~~our Chairman of the Board~~2022, ~~collectively~~is ~~have~~a ~~voting~~line ~~power~~of ~~over~~original ~~1,733,750~~comics ~~shares~~and ofgraphic ~~our~~novels ~~common~~from ~~stock~~a ~~(which includes~~diverse ~~545,360~~lineup ~~shares~~ of ~~our~~writers ~~Class~~and Cartists ~~common~~creating ~~stock~~content ~~(which~~across is all genres ~~the issued~~ and ~~outstanding~~for ~~shares~~all ofage ~~the~~groups. ~~Class~~IDW COriginals ~~common~~works ~~stock),~~with ~~which are~~top-tier ~~convertible~~talent ~~into~~including New ~~shares~~York ofTimes bestselling ~~our~~writers like ~~Class~~Scott BSnyder ~~common stock~~ on Dark aSpaces: ~~1-for-1 basis~~Wildfire, ~~and~~Stephen ~~1,188,390~~Graham ~~shares~~Jones ~~of our Class B common stock), representing approximately 61.0%~~on ~~of the combined voting power of our outstanding capital stock~~Earthdivers, asand ~~of January 14, 2022~~G. InWillow ~~addition,~~Wilson ~~as of January~~on The ~~14,~~Hunger ~~2022,~~and ~~Howard~~the ~~S. Jonas beneficially holds 2~~Dusk,~~374,962~~ ~~shares~~in ofaddition ~~our Class B common stock, warrants~~ to ~~purchase~~ up-and-coming totalent ~~89,243~~with ~~shares~~the goal of ~~our~~ ~~Class~~creating Bthe ~~common~~bestsellers ~~stock at a price per share~~ of ~~$42~~tomorrow.02 ~~and~~IDW ~~warrants~~Originals ~~to purchase up to 98,336 shares of our Class B common stock at a~~is ~~price~~also ~~per~~focused ~~share~~on ofcreating ~~$26.44.~~IP ~~Each~~that ofcan ~~the~~be ~~Trusts~~exploited ~~has~~across amultiple ~~different,~~media ~~independent trustee~~platforms.

17IDWP is also home to Artist’s Editions, which publishes oversized deluxe hardcovers featuring scans of original art printed at the same size they were drawn with the distinctive creative nuances that make original art unique. Some of the standout Artist’s Editions titles include Jim Lee’s X-Men, Mike Mignola’s Hellboy, Todd McFarlane’s Spider-Man, David Mazzucchelli’s Daredevil Born Again and Dave Stevens’ The Rocketeer.

~~Howard S.~~Many ~~Jonas~~of ~~serves~~IDWP’s astitles ~~our~~are ~~Chairman~~available worldwide ofthrough ~~the~~foreign ~~Board,~~licensing ~~which~~with is642 ~~not~~titles anavailable ~~officer~~in ~~position.~~approximately ~~However,~~62 heterritories isin ~~our~~approximately ~~founder~~24 ~~and~~languages. ~~served~~In ~~as an executive officer~~2020, IDW ~~including~~launched ~~our~~a ~~Chief~~new ~~Executive~~initiative ~~Officer,~~to ~~for~~release akey ~~very~~titles ~~significant~~as ~~time~~Spanish-language ~~period,~~graphic ~~and~~novels in the ~~members~~North ofAmerican ~~the~~market ~~Board~~with ~~and~~the ~~management~~release ~~often~~of ~~look~~Spanish-language toeditions ~~him~~of They ~~for~~Called ~~guidance~~Us onEnemy, Red ~~major~~Panda & Moon ~~financial~~Bear, Locke ~~operational~~ & Key and Sonic ~~strategic~~the ~~matters~~Hedgehog.

Howard S. Jonas does not have the right to direct or control the voting of the shares of our common stock that are held by the Trusts, and the independent trustees hold sole voting and dispositive power over the common stock held by the Trusts. However, Howard S. Jonas is the trustor of the trusts and is the father of each of the beneficiaries of the Trusts and his views may be taken into account by the trustees and others related to the Trusts.4

~~We are~~IDWP ~~not~~is ~~aware~~a ofparty ~~any~~to ~~voting~~an agreement ~~between~~with orPenguin ~~among~~Random House ~~any~~(“PRH”), ofthat ~~the~~was ~~Trusts~~amended ~~and/or~~in ~~Howard~~June S.2021 ~~Jonas,~~(and ~~but~~became ifeffective ~~such~~in aJune ~~voting~~2022) ~~agreement~~and orhas ~~other similar~~a ~~arrangement~~term ~~exists~~until orMarch ~~were~~31, 2024. Pursuant to bethe ~~consummated~~agreement, ifas ~~all~~amended, orPRH ~~several~~serves oras ~~all~~the ofexclusive ~~the~~worldwide ~~Trusts~~distributor ~~were~~for toall ~~act~~IDWP inproducts ~~concert,~~other orthan ifperiodical wecomic ~~issued~~books ~~additional~~for ~~Class~~the Cnon-direct ~~common~~market ~~stock,~~channel ~~certain or all of the Trusts~~ and~~/or~~ ~~Howard~~since S.June ~~Jonas~~2022, ~~along~~as ~~with holders of~~ the ~~Class~~exclusive Cworldwide ~~common~~multi-year ~~stock~~sales ~~would be~~and ~~able~~distributor tofor ~~control~~IDWP’s ~~matters~~newly published ~~requiring~~and ~~approval~~backlist bycomic ~~our~~book ~~stockholders~~periodicals, ~~including~~trade ~~the~~collections, ~~election~~and ofgraphic ~~all~~novels ofto the ~~directors,~~direct ~~amendment~~market ofcomic ~~organizational documents~~shops. ~~and~~Pursuant ~~the~~to ~~approval of significant corporate transactions~~the agreement, ~~including~~as ~~any merger~~amended, ~~consolidation~~PRH oralso ~~sale~~(1) ofprovides ~~all~~warehousing, orcustomer ~~substantially all~~service, oforder ~~our~~fulfillment, ~~assets.~~shipping, Asreturns aprocessing, ~~result~~billing/collections, customer ~~the~~credit ~~ability~~management, ofsales, ~~any~~sales ofreporting, ~~our~~stock ~~other~~control ~~stockholders~~and Web-access to ~~influence~~sales ~~our~~and ~~management~~inventory ~~may~~information befor ~~limited.~~IDWP’s ~~In addition,~~single ~~our~~issue ~~dual~~comic ~~class~~books ~~structure~~and ~~has~~other anproducts ~~anti-takeover~~manufactured ~~effect,~~by IDWP and ~~accordingly,~~intended ~~the~~for ~~holders~~distribution ofto the ~~shares~~direct ofmarket ~~Class~~and C(2) ~~common~~maintains ~~stock~~and ~~have the ability~~operate toa ~~prevent~~.biz ~~any~~retailer ~~change~~website infor ~~control~~the ~~transactions~~provision ~~that~~of ~~may~~such ~~otherwise~~services beto ~~in the best interest of stockholders~~IDWP.

~~Item~~The agreement obligates PRH to, among other things, 1Buse reasonable skill and care in accordance with its usual practice in providing the services; and maintain a reserve against future returns. ~~Unresolved~~The ~~Staff~~agreement ~~Comments~~provides for the allocation of risk related to the products to be distributed between IDWP and PRH and related to collection of amounts owing.

~~None~~The agreement provides that neither IDWP nor PRH will be liable to each other for failure to perform any obligation under the agreement to the extent that and so long as the failure is caused matters beyond their control.

~~Item~~The agreement also provides that either party 2.may ~~Properties~~terminate the agreement upon a material or persistent uncured breach by the other party, or, on six months’ notice following a change of control of either party or party’s parent.

~~IDW Media Holdings is headquartered at 520 Broad St, Newark, New Jersey, fourth floor.~~ The ~~term~~agreement ofalso ~~the~~contains ~~lease~~customary ~~commenced on December 1, 2018~~indemnification and isconfidentiality ~~month-to-month with 30 days written notice upon termination~~provisions. ~~Currently, the annual rent expense is $19,200.~~

~~IDWP is~~Prior ~~headquartered~~to inJune 182022,~~344~~ ~~square~~Diamond ~~feet~~Comic ofDistributors, Inc. ~~leased~~(“Diamond”) ~~space~~served atas ~~2765/2785~~IDWP’s ~~Truxtun~~distributor ~~Road,~~to ~~San~~the ~~Diego~~direct market, CAworldwide. InIDWP ~~addition,~~works ~~IDWP~~together ~~leases~~with ~~18,000~~PRH ~~square~~to sell-in ~~feet~~and ofpromote ~~warehouse~~IDWP ~~space~~titles to buyers at ~~4937~~non-direct ~~Market~~market ~~Street~~customers such as Amazon, ~~San~~Barnes ~~Diego~~& ~~CA.~~Noble, ~~Both~~Baker ~~these~~& ~~leases~~Taylor, ~~expire~~Ingram, ~~May~~Follett, Target, ~~2022~~Walmart, and ~~fiscal~~more. ~~2021~~Additionally, ~~rent~~IDWP ~~was~~sells ~~$547~~an assortment of titles directly to Scholastic Book Fairs and Clubs,~~197~~ which Scholastic purchases on an ad hoc basis.

~~IDWE~~In 2014, IDWP launched IDW Games to develop and ispublish ~~headquartered~~card, atboard, ~~11969~~and ~~Ventura~~tabletop ~~Blvd~~games. Similar to IDWP’s book content, ~~Suite~~IDW ~~100~~Games offered a mix of popular licensed titles such as Dragon Ball Z and Batman the Animated Series, ~~Studio~~as ~~City~~well as creator developed strategic hobby games, CAsuch as Towers of Arkhanos and Tonari. ~~The~~IDW ~~annual~~Games’ ~~rent~~products ~~for~~were ~~fiscal~~sold ~~2021~~to ~~was~~distributors ~~$130~~worldwide and are available through retailers such as GameStop,~~508~~ Barnes & Noble, and ~~the~~Amazon, ~~lease~~independent ~~term expires~~games, ~~May~~and 31comics stores, ~~2022~~as well as the direct-to-consumer channel through its website and marketing campaigns. ~~Our~~In ~~principal~~calendar ~~executive~~2021, ~~office~~the isCompany ~~located~~wound indown ~~520~~IDW ~~Broad~~Games ~~Street~~and, ~~Newark~~going forward, ~~New~~IDW ~~Jersey~~Games is only backfilling final orders and reproducing select existing products.

~~Item~~To further expand and build creator-owned properties 3.beyond ~~Legal~~publishing, ~~Proceedings~~IDWP works with IDWE, as well as other outside partners, to bring creator-owned franchises to television and film through licensing arrangements.

~~The Company~~To ~~may~~expand ~~from~~its ~~time~~business toand ~~time~~compete bewith ~~subject~~other industry toparticipants, ~~legal~~IDWP ~~proceedings~~continues ~~that~~to ~~may~~focus ~~arise~~on inlaunching ~~the~~new ~~ordinary~~creator-owned ~~course~~titles ofand ~~business.~~partnering ~~Although~~with ~~there~~established ~~can~~brands ~~be no~~to ~~assurance~~bring infan-favorite properties ~~this~~to ~~regard,~~the ~~other~~comics ~~than~~market. ~~noted~~IDWP ~~above,~~is expanding the ~~Company~~reach ~~does~~of ~~not~~existing ~~expect~~and ~~any~~new products through the development of ~~those~~specialty, ~~legal~~library, and ~~proceedings~~education tomarkets; ~~have~~increased adirect-to-consumer ~~material~~initiatives; ~~adverse effect~~and onbroadening the ~~Company’s~~reach ~~results~~ of ~~operations,~~creator-driven ~~cash~~series ~~flows~~through orlicensing ~~financial condition~~opportunities.

~~Item 4~~IDWP’s revenues represented 71.6% ~~Mine~~and 78% ~~Safety~~of ~~Disclosures~~our consolidated revenues in fiscal 2022 and 2021, respectively.

~~Not applicable.~~IDW Entertainment

18IDWE is a production company and studio that develops, produces and distributes content based on IDWP’s original, copyrighted IP, published in the form of comic books, graphic novels and any other forms of print publication, for a variety of formats including film and television.

~~Part~~IDWE was formed on September II20, 2013 to leverage IDWP properties into television series, features, and other forms of media by developing and producing original content. IDWE maintains a development slate of properties based on IDWP properties for the adult series/features marketplace and the kids, family, and animation spaces.

~~Item~~ 5~~. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.~~

~~PRICE~~IDWE has developed and/or ~~RANGE~~produced OFa ~~COMMON~~number ~~STOCK~~of series for television:

Our Class B common stock commenced trading on the NYSE American on August 4, 2021 under the symbol “IDW.”

●

Wynonna Earp season four aired in two parts on SyFy due to worldwide COVID-19-related production shutdowns. The first six episodes of season four premiered July 26, 2020 and the second half of season four began airing March 5, 2021. The show was created by Emily Andras and stars Melanie Scrofano and is based on the IDWP comics of Beau Smith of the same name. Season four’s twelve episodes were produced by Seven24 Films and distributed by IDWE, in partnership with Syfy and CTV Sci-Fi. Cineflix Studios is the co-producer and global distributor for the series. Season one’s thirteen episodes aired in fiscal 2016, season two’s twelve episodes aired in fiscal 2017, and season three’s twelve episodes aired in fiscal 2018.

●

V Wars debuted on Netflix on December 5, 2019. The 10-episode vampire thriller stars Ian Somerhalder and was produced by High Park Entertainment. The series was based upon Jonathan Maberry’s IDWP comic book series of the same name. Some rights to IDWE’s streaming genre series V Wars reverted back to IDW in 2022; as a result, we will be exploring opportunities to monetize the past season and potential opportunities to continue the story with a new partner.

On● ~~January~~October ~~17,~~Faction ~~2022,~~premiered ~~there~~on ~~were~~Netflix ~~128~~on ~~holders~~January ~~of record~~23, of2020. ~~our~~The ~~Class~~10-episode Bshow ~~common~~was ~~stock~~based ~~and~~on 8the ~~holders~~IDWP ofcomics ~~record~~ of ~~our~~Steve ~~Class~~Niles Cand ~~common~~Damien ~~stock,~~Worm ~~which~~of ~~is not publicly traded. These numbers do not include~~ the ~~number~~same ofname ~~persons~~and ~~whose~~was ~~shares~~adapted ~~are~~by inshowrunner ~~nominee~~Damian orKindler inand ~~“street~~starred ~~name”~~Tamara ~~accounts~~Taylor ~~through~~and ~~brokers~~J.C. OnMacKenzie. ~~January~~It ~~19, 2022,~~was ~~the~~also ~~last~~produced ~~sales~~by ~~price~~High ~~reported~~Park ~~on the NYSE American for the Class B common stock was $2~~Entertainment.~~26 per share.~~

~~We have~~● ~~not~~Locke ~~paid~~& ~~dividends~~Key premiered on ~~our~~Netflix ~~Class~~on BFebruary ~~common stock~~7, ~~and~~2020. ~~currently~~The doshow ~~not~~is ~~intend~~based toon ~~pay~~the ~~any~~critically ~~cash~~acclaimed ~~dividends~~graphic onnovels ~~our~~of ~~Class~~the Bsame ~~common~~name ~~stock in~~of ~~the~~Joe ~~foreseeable~~Hill ~~future~~and Gabriel Rodriguez published by IDWP. ~~Our~~Season ~~current~~two ~~policy~~premiered isOctober to22, ~~retain~~2021, ~~all~~landing ofin ~~our~~the ~~earnings~~Top to10 ~~finance~~on ~~future~~Netflix’s ~~growth.~~global ~~Any~~TV ~~future~~charts ~~declaration~~in ofover ~~dividends will~~81 becountries, ~~subject~~and toseason ~~the~~three ~~discretion~~premiered ofAugust ~~our~~10, ~~Board~~2022 ofon ~~Directors~~Netflix.

~~In addition,~~● weSurfside ~~may~~Girls ~~incur~~is ~~debt~~based ~~financing~~on in the ~~future,~~Top ~~the~~Shelf ~~terms~~graphic novel of ~~which~~the ~~will~~same ~~likely~~name ~~prohibit~~and uspremiered ~~from~~on ~~paying~~August ~~cash~~19, ~~dividends~~2022 ~~or distributions~~ on ~~our~~Apple ~~Class B common stock~~TV+. ~~Even~~All iften weepisodes ~~are~~of ~~permitted to pay cash dividends in~~ the ~~future,~~live weaction ~~currently~~kids’ ~~anticipate~~series ~~that~~premiered wein ~~will~~over ~~retain all~~80 ~~future~~countries ~~earnings,~~worldwide ifon ~~any, to fund~~ the ~~operation~~Apple ~~and~~TV ~~expansion of our business and for general corporate purposes~~platform.

~~The information~~Business ~~required~~Model by Item 201(d) of Regulation S-K will be contained in our Proxy Statement for our Annual Stockholders Meeting, which we will file with the Securities and Exchange Commission within 120 days after October 31, 2021, and which is incorporated by reference herein.

~~Performance~~While in the past, IDWE ~~Graph~~focused on television development and financing production opportunities, a broadening of ~~Stock~~our strategic goals has evolved to focus on lower risk investments as well as developing IP for feature film and podcast opportunities. As was the case with Surfside Girls, IDWE provided co-studio services which enabled us to utilize our studio partners’ infrastructure to support the needs of productions while reducing our own risk. We have also diversified our position by acting as non-writing executive producers on current and future projects which allows us to secure fees for our services while minimizing costs. With more varied opportunities for our content/IP, we expect to grow our brand, expand the perception of IDWE, increase revenue opportunities for the publishing side of the business and develop a more robust entertainment footprint.

WeThe path to greenlighting ~~are~~a project can take many routes, but the two most common include internal development and partnering with established studios and streamers. For internal development, IDWE partners with established television and film talent to develop pitches based on our IP, then takes those pitches to buyers. Buyers who want to partner on IDWE’s pitches will enter into a ~~smaller~~deal ~~reporting~~to ~~company~~commission asa ~~defined~~pilot byscript ~~Rule~~or ~~12b-2~~feature screenplay, which will be the determining factor of a series or feature film being greenlit. In the ~~Securities~~second ~~and~~scenario, ~~Exchange~~IDWE ~~Act~~may ofoption ~~1934~~what’s called clean IP (projects without any attachments or development with talent) to a buyer/production partner and ~~are~~develop/package ~~not~~a ~~required~~series or feature. While this scenario may require more work between IDWE and the buyer to ~~provide~~develop a concept for adaptation, the advantage is ~~information~~that ~~under~~IDWE is doing this ~~item~~in tandem with the buyer or platform – guaranteeing that what is developed is strategically what they are looking for.

~~Issuer Repurchases of Equity Securities~~ 6

~~None.~~Co-Development Model

~~Item~~In addition to IDWE leveraging 6IDWP’s original releases for media spinoffs and adaptation, IDWE has begun sourcing TV series and feature ideas from established show runners and writer/directors; then bringing these ideas to IDWP. ~~[Reserved]~~Where both of our segments see an opportunity, we can develop both a comic book/graphic novel and prepare a series or feature pitch concurrently. We believe that there is an appeal in the entertainment industry for this model by talent and producing partners. With more than five of these properties already in negotiation, we previously announced the first – entitled Family Time.

~~Item~~Family Time is 7.co-created ~~Management’s~~by ~~Discussion~~showrunners Matt Silverstein and ~~Analysis~~Dave ofJeser, ~~Financial~~who ~~Condition~~are known for creating Drawn Together, and ~~Results~~running shows like Solar Opposites and an upcoming untitled show with Jimmy Kimmel for ABC. IDWE plans to pitch the series in March/April of ~~Operations~~2023 and the comic book is expected to be released in August 2023.

~~This Annual~~IDWE’s ~~Report~~revenues ~~contains~~represented forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements that contain the words “believes,” “anticipates,” “expects,” “plans,” “intends” and similar words and phrases28.4% ~~These forward-looking statements are subject to risks~~ and ~~uncertainties that could cause actual results to differ materially from the results projected in any forward-looking statement~~22.0 In% ~~addition~~of toour ~~the~~consolidated ~~factors~~revenues ~~specifically noted~~ in the ~~forward-looking~~fiscal ~~statements,~~years ~~other~~ended ~~important~~October ~~factors~~31, ~~risks~~2022 and ~~uncertainties~~October ~~that could result in those differences include~~31, ~~but are not limited to~~2021, ~~those discussed under Item 1A to Part I “Risk Factors” in this Annual Report~~respectively. The forward-looking statements are made as of the date of this Annual Report, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth in this report and the other information set forth from time to time in our reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934, including our reports on Forms 10-Q and 8-K.

19CTM (Discontinued operations)

~~The~~As a result of the economic downturn related to ~~following~~the ~~discussion~~COVID-19 ~~should~~pandemic, beand ~~read~~the inimpact ~~conjunction~~it had on CTM, we decided to sell CTM and focus on our entertainment and publishing businesses. On February 15, 2021 the sale was consummated and CTM is only consolidated until the sale date with the ~~Consolidated~~gain ~~Financial~~reflected ~~Statements~~separately in the consolidated statement of operations. Pursuant to a Stock Purchase Agreement dated as of July 14, 2020, we sold all of the stock of CTM to an assignee of Howard S. Jonas, our Chairman and ~~Notes~~Chairman ~~thereto~~of ~~included~~the Board, in ~~Item~~exchange 8for (i) the cancelation of $3.75 million of indebtedness ~~this~~owed ~~Annual~~to ~~Report~~the Mr. Jonas’ designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date (which condition was not met), and (iii) a contingent payment if CTM is sold within 36 months of the CTM Sale Date for more than $4.5 million.

~~Critical Accounting~~Our ~~Policies~~ Strategy

~~Our~~We ~~consolidated~~have ~~financial~~a ~~statements~~long-standing ~~and~~publication ~~accompanying~~business ~~notes are prepared~~reaching invarious ~~accordance~~segments ~~with~~and ~~generally accepted accounting principles in the United States~~audiences. ~~The~~IDWE ~~preparation~~is ofable ~~financial statements requires management~~ to ~~make~~create ~~estimates~~television and ~~assumptions~~video ~~that~~entertainment ~~affect~~based ~~the~~upon reported amounts of assets, liabilities, revenues and expenses as well as the disclosure of contingent assets and liabilities. Critical accounting policies are those that require application of managementIDWP’s ~~most~~solid ~~subjective or~~content ~~complex judgments, often as a result of matters that are inherently uncertain and may change in subsequent periods~~foundation. ~~Our critical accounting~~ ~~policies~~IDWP ~~include those related to the allowance for doubtful accounts goodwill, valuation of long-lived assets including intangible assets with finite useful lives~~ and ~~ultimate~~IDWE ~~revenues~~work ~~for~~together ~~television costs. Management bases its estimates and judgments on historical experience and other factors that are believed~~ to beoptimize ~~reasonable under~~ the ~~circumstances.~~financial ~~Actual~~return ~~results~~of ~~may differ from these estimates under different assumptions or conditions. See Note 1 to~~ the ~~consolidated~~IP ~~financial~~which ~~statements~~we ~~in this Annual Report for a complete discussion of our significant accounting policies~~control.

~~Results~~IDW’s ofstrategic ~~Operations~~focus is to nurture, support and partner with both already successful and also up and coming new voices to bring their comic books and graphic novels to the widest audience possible.

WeIDWP ~~evaluate~~seeks ~~the~~to ~~performance~~build ofa ~~our~~robust, ~~operating~~original slate ~~business~~of ~~segments~~properties ~~based~~that ~~primarily~~not ononly ~~income~~gives ~~(loss)~~creators ~~from~~the ~~operations.~~opportunity ~~Accordingly,~~to ~~the~~realize ~~income~~their ~~and~~unique ~~expense~~visions, ~~line~~but ~~items~~to ~~below~~establish ~~loss~~IDWP ~~from~~as ~~operations~~the “Partner ~~are~~of ~~only~~Choice” ~~included~~so inwe ~~our~~see ~~discussion~~and ofsecure under contract the ~~consolidated~~best ~~results~~opportunities offrom ~~operations~~the creative community.

20In addition, IDWP’s goal is to continue publishing a diverse list of titles and products which can leverage the strength of our known IP names and partnerships and drive maximum revenue against our core list, while also continuing to bring new IP to the table.

IDWE seeks to take the IDWP deep catalog of comic book and graphic novel IP and turn them into television, film and podcast entertainment.

(in thousands)							Change
Fiscal Year ended October 31,	2021			2020			$			%
Revenues	$	25,284		$	23,850		$	1,434			6.0	%
Direct cost of revenues		13,682			12,663			1,019			8.0	%
Selling, general and administrative		12,139			11,074			1,065			9.5	%
Depreciation and amortization		203			216			(13	)		(6.0	)%
Bad debt expense		30			-			30			100.0	%
Income (loss) from operations	$	(770	)	$	(103	)	$	(667	)		(647.6	)%

With IDWP and IDWE working together, IDW strives to build our most valuable asset, which is our relationships with the creators and their IP visions. The more successful IDW is for them, the more IDW becomes the ‘Partner of Choice’ for the creative community.

~~nm—~~IDWE seeks to turn IP into television and other video entertainment. Among our partners are streaming services as well as traditional broadcast and other networks and other content services. To date, IDWE has sold projects to Hulu, Syfy, BBC America, Netflix and AppleTV+. A multitude of additional IPs have been optioned. The Company does not ~~meaningful~~ currently fund production.

~~The~~We ~~results~~believe ofthat ~~Clover~~our ~~Press~~potential ~~were~~projects ~~included in~~would ~~the~~be ~~IDWP~~attractive ~~segment~~to ~~from~~a ~~June~~broad 1,range ~~2019, through March 31, 2020. As~~ of ~~April~~potential 1,distribution ~~2020,~~channels ~~Clover Press is no longer a consolidated entity~~ and ~~became~~ ~~a cost method investment~~participants.

~~Revenues.~~We ~~Revenues~~are ~~increased~~increasingly byfocused ~~$1.434,000~~on inattempting ~~the fiscal year ended October 31, 2021 compared~~ to ~~the fiscal year ended October 31, 2020. IDWP revenue increased by $2,116,000 driven by several high-performing~~increase ~~direct~~our ~~market~~ownership ~~titles,~~positions ~~increased direct-to-consumer sales and from lower sales~~ in ~~fiscal 2020 due to~~ the ~~temporary~~IP ~~halt~~which ofwe ~~direct market sales as a result of COVID-19~~distribute. ~~Digital~~In ~~sales~~coming ~~increased by $83~~years,~~000~~ inwe ~~fiscal~~believe ~~2021~~that ~~compared~~these toownership ~~fiscal~~positions ~~2020~~will ~~due~~be toaccretive ~~continued strong sales across all platforms. Sales returns~~ and ~~discounts decreased by $177,000 in the comparable periods. The foregoing positive impacts were~~ ~~partially~~provide ~~offset~~greater bylibrary ~~decreased~~value games revenue of $556,000 in fiscal 2021 compared to fiscal 2020 due to fulfillment of a direct-to-consumer games campaign in fiscal 2020 and decreased licensing and royalty revenues of $255,000 primarily due to co-publishing royalty revenue in fiscal 2020. Additionally, Clover Press revenues decreased by $131,000 as they were not consolidated in the fiscal year ended October 31, 2021 while they were consolidated for ~~a portion of fiscal 2020~~IDW.

In October 2021, Hasbro informed us that effective March 2023, our licenses for the Transformers and GI Joe titles will be terminated. While the cancellation of the licenses for Transformers and GI Joe are anticipated to decrease revenues by approximately $1.2 million in fiscal year 2023, IDWP plans to mitigate the loss of revenue by enhancing its current key licensor brands. Additionally, revenues from originals editorial will begin to materialize in July 2022 with five to six new IDW original titles spanning fiscal 2022 and a planned output of doubling quantities each progressing fiscal year.7

~~Direct~~Competition cost of revenues. IDWP direct cost of revenues increased by $1,019,000 in the fiscal year ended October 31, 2021, compared to the fiscal year ended October 31, 2020. IDWP direct cost of revenues consists primarily of printing expenses, costs of artists and writers, and royalties. Additionally, Clover Press direct cost of revenues decreased by $55,000 as they were not consolidated in the fiscal year ended October 31, 2021.

~~IDWP’s~~IDW ~~gross~~competes ~~margin~~with ~~for~~companies ~~the~~such ~~fiscal year ended October 31~~as, ~~2021~~BOOM and ~~decreased~~Dark toHorse ~~45.9%~~– ~~from~~companies ~~46.9%~~who ~~for~~are ~~the~~leveraging ~~fiscal~~their ~~year~~IP ~~ended~~on ~~October~~the ~~31,~~publishing ~~2020.~~side ~~The~~for ~~decrease~~media isadaptation ~~principally due to a one-time write-down of development costs related to projects no longer being pursued~~opportunities.

~~Selling,~~IDWE ~~General~~competes ~~and~~with ~~Administrative.~~all ~~IDWP’s selling,~~forms general and administrative expenses increased by $1,065,000 in the fiscal year ended October 31, 2021, compared to the fiscal year ended October 31, 2020, primarily due to increases in salaries and benefits of ~~$587,000, severance of $463,000, overhead allocations~~entertainment. ofA ~~$420,000,~~significant ~~consulting~~number ~~fees~~ of ~~$286,000,~~companies ~~shipping~~produce and/or ~~direct-to-consumer~~distribute ~~costs~~television ofshows ~~$131,000,~~ and ~~other~~films ~~net~~and ~~changes~~provide ofpay ~~$57,000.~~television ~~These increases were partially offset by decreases in marketing expenses of $276,000, non-cash compensation of $189,000,~~ and ~~occupancy~~streaming ~~expenses~~services. ofIDWE ~~$98,000.~~also ~~Additionally,~~competes ~~Clover~~to ~~Press~~obtain ~~consolidated~~creative ~~selling,~~talents ~~general,~~ and ~~administrative~~story ~~decreased~~properties bythat ~~$316,000~~are asessential ~~they~~to ~~were not consolidated in~~ the ~~fiscal~~success ~~year~~of ~~ended~~our ~~October~~IDWE ~~31, 2021~~business.

AsCompetitive aAdvantages/ ~~percentage of IDWP’s revenues, selling, general and administrative expenses in the fiscal year ended October 31, 2021, were 48.0% compared to 46.4% in the fiscal year ended October 31, 2020.~~Disadvantages

21IDW believes that its competitive advantages include that it is one of the few fully integrated publishing companies whose strategic mandates guarantee that we will not publish a project that doesn’t also grant us the entertainment rights. IDWP has the opportunity to take advantage of some of our competition’s title count reduction to claim more of the market share in both the direct market and the non-direct market, as we increase our SKU counts against our key licensed properties.

~~IDWE~~While companies like DC and Marvel have a long history in the business and a deep catalog of superhero IP, their flexibility to try new genres and expand the diversity of their slate is more limited than that of IDW. They’re beholden to a history and canon that they can’t often diverge from. IDW, however, is in a position to publish new, original and creative concepts that could be the next big hit. Our opportunities to create and release new and exciting visions is a significant upside. However, this can also be a disadvantage in a world where some buyers are only interested in adapting already-known concepts and characters.

(in thousands)							Change
Fiscal year ended October 31,	2021			2020			$			%
Revenues	$	7,141		$	14,312		$	(7,171	)		(50.1	)%
Direct cost of revenues		8,101			16,867			(8,766	)		(52.0	)%
Selling, general and administrative		5,694			5,568			126			2.3	%
Depreciation and amortization		36			33			3			9.1	%
Bad debt expense		-			433			(433	)		(100.0	)%
Loss from operations	$	(6,690	)	$	(8,589	)	$	1,899			22.1	%

Finally, perception can be helpful in growing the business opportunities. IDWE has, over the last fiscal year, set up many projects at major buyers and streamers, further establishing how active we are in the film and television business. As a result, there are more incoming opportunities and a desire on behalf of major companies to work with us on adapting our IP into new entertainment properties.

~~nm—not meaningful~~The success of our operations is heavily dependent upon public taste and preferences which can be unpredictable at times. In addition, operating results fluctuate due to the timing and performance of releases in the television and book markets.

~~Revenues.~~Intellectual IDWE revenues for the fiscal year ended October 31, 2021 decreased by $7,171,000 compared to the fiscal year ended October 31, 2020. Revenues in the fiscal year ended October 31, 2021, included revenues derived from delivered episodes from Wynonna Earp of $3,496,000, the completion of the CRA audit which established the final tax credit for V Wars and October Faction of $3,331,000, Locke & Key contingent compensation from season two of $200,000 and foreign receipts from Dirk Gently of $114,000. In the fiscal year ended October 31, 2020, revenues consisted of delivered episodes and tax credits from October Faction and V Wars of $4,339,000, delivered episodes from Wynonna Earp in the amount of $5,419,000, Locke & Key season one in the amount of $4,000,000 and foreign sales from Dirk Gently in the amount of $554,000.Property

~~Direct~~IDWP ~~costs~~enters ofinto ~~revenues.~~publishing ~~Direct~~agreements ~~cost~~with owners of ~~revenues~~either ~~consists~~Creator ~~primarily~~Content ofor ~~the~~Licensed ~~amortization~~Content of(collectively ~~production~~“Content”) ~~costs~~pursuant ~~that~~to ~~were~~which ~~capitalized~~IDWP ~~during~~licenses the ~~production~~right ~~of the television episodes and direct costs related~~ to ~~revenue~~exploit ~~recognized~~such ~~during~~Content ~~related periods~~(“Publishing Agreements”).

~~Direct~~IDWP’s ~~costs~~Publishing ofAgreements ~~revenues~~grant ~~for~~to ~~the fiscal year ended October 31,~~IDWP ~~2021 decreased by $8~~exclusive,~~766,000~~ ~~compared~~long ~~to the fiscal year ended October 31~~term, ~~2020.~~worldwide ~~The~~rights ~~amortized~~to ~~television~~publish ~~costs~~and ~~for~~sell the ~~fiscal~~Content ~~year ended~~in ~~October~~all ~~31,~~languages ~~2021,~~via ~~consisted~~traditional ofchannels ~~delivered~~such ~~episodes~~as ~~from~~print ~~Wynonna~~and ~~Earp of $5~~digital comics,~~251,000,~~ ~~Locke &~~graphic ~~Key season two of $48~~novels,~~000,~~ ~~cost refinement from October Faction~~ and Vtrade ~~Wars of $586~~collections,~~000~~ and ~~impairment charges~~niche ofchannels ~~$2,216,000.~~such ~~The~~as ~~amortized~~coloring ~~television costs for the fiscal year ended October 31~~books, ~~2020,~~audio ~~included~~on ~~Locke & Key season one of $1~~demand,~~214,000,~~ ~~Wynonna Earp of $6,491,000, cost refinements from October Faction of $7,967,000~~ and Vhigh-end limited-edition ~~Wars~~publications of(“Publishing ~~$1,190,000and other costs of $5,000~~Rights”).

~~IDWE’s~~A ~~gross~~smaller ~~margin~~percentage ~~for~~of ~~the~~Publishing ~~fiscal~~Agreements cover ~~year~~a ~~ended~~more ~~October~~limited ~~31,~~range ~~2021, was~~of ~~negative~~licensed ~~13.4%~~rights ~~compared~~in order to ~~negative~~accommodate ~~17.9%~~pre-existing ~~for~~products ~~the~~and ~~fiscal~~markets ~~year~~already ~~ended~~established ~~October~~by 31licensors such as foreign publishers seeking to have IDWP publish an English only version, ~~2020.~~Licensed ~~These~~Content ~~gross~~owners ~~margin~~seeking ~~figures~~expansion ~~are~~into ~~aligned~~niche ~~with~~markets ~~the~~that ~~explanations~~can ~~provided~~be ~~for~~more ~~revenues~~successfully exploited by IDWP and ~~direct~~establish ~~costs~~authors ofwho ~~revenues~~have already enjoyed publishing success prior to partnering with IDWP.

~~Selling,~~Many ~~General~~of ~~and~~IDWP’s ~~Administrative.~~Publishing ~~Selling,~~Agreements ~~general~~that ~~and~~are ~~administrative~~Creator Content ~~expenses~~focused ~~increased~~also bygrant ~~$126,000~~to ~~during~~IDWP ~~the~~exclusive ~~fiscal year ended October 31~~film, ~~2021~~television, ~~compared to the fiscal year ended October 31~~merchandising, ~~2020. The increase was driven by salary~~ and ~~benefits~~other ofancillary ~~$527,000,~~worldwide ~~recruitment~~rights ~~fees~~in ofall ~~$151~~formats,~~000~~ ~~and overhead allocations of $574~~languages,~~000, offset by~~ ~~lower~~and ~~rent~~current ofand ~~$48,000,~~future ~~marketing~~media ofand ~~$447,000,~~delivery ~~consulting~~technologies ~~fees~~(“Ancillary ofRights”) ~~$30,000,~~that ~~promotional~~can ~~production~~then ~~materials~~be ofexploited ~~$512,000,~~through ~~legal~~IDWE ~~fees~~or ~~of $58,000, office supplies of $21,000 and other expenses of $10,000~~otherwise.

AsIDWP aexploits ~~percentage~~the ofPublishing ~~IDWE’s~~Rights ~~revenues,~~via ~~selling,~~sales ~~general~~to ~~and~~comic ~~administrative~~book specialty ~~expenses~~stores, intraditional ~~the~~retail ~~fiscal~~outlets, ~~year~~and ~~ended~~direct ~~October~~to 31consumers, ~~2021,~~and ~~was~~via ~~79.7%~~sublicenses ~~compared~~ to ~~38.9%~~digital indistribution ~~the~~platforms ~~fiscal~~and ~~year ended~~foreign ~~October 31, 2020~~territory sub-publishers.

22IDWP exploits the Ancillary Rights primarily via its relationship with IDWE, but also through other third-party buyers.

~~Net~~IDWP ~~loss~~has ~~IDW~~registered ~~Media~~and ~~Holdings,~~owns ~~Inc~~domain names that it uses to digitally promote and sell its products. It also has trademarked its name and logo, as well as the name and logo of its Top Shelf Productions imprint.

~~Consolidated~~IDWP's business model is evolving from placing more emphasis on Licensed Content and limited Ancillary Rights to developing a larger catalog of Creator Content and a full range of Ancillary Rights in combination with a more selective slate of Licensed Content.

(in thousands)							Change
Fiscal year ended October 31,	2021			2020			$		%
Loss from continuing operations	$	(8,685	)	$	(9,324	)	$	639		6.9	%
Interest income (expense), net		118			(46	)		164		356.5	%
Other income (expense), net		2,333			(318	)		2,651		833.6	%
Net loss from continuing operations		(6,234	)		(9,688	)		3,454		35.7	%
Loss from discontinued operations, net		(1,281	)		(4,110	)		2,829		68.8	%
Gain on sale of discontinued operations		2,123			-			2,123		100.0	%
Net loss	$	(5,392	)	$	(13,798	)	$	8,406		60.9	%

~~nm—not meaningful~~COVID-19 Guiding Principles

~~Loss~~IDW ~~from~~follows ~~operations.~~all ~~Loss from operations decreased by $639~~state,~~000~~ ~~in the fiscal year ended October 31~~local, ~~2021,~~and ~~compared~~federal toCenters ~~the~~for ~~fiscal~~Disease ~~year ended October 31, 2020, due to increased~~Control ~~operating income from IDWE of $1,899,000~~ and ~~decreased~~Prevention ~~operating~~(“CDC”) ~~losses~~public ~~from~~guidelines. ~~IDWP~~To ofthe ~~$667~~extent possible,~~000,~~ ~~partially~~physical ~~offset~~distancing byshall anbe ~~increase~~maintained. inWhen ~~corporate~~physical ~~overhead~~distancing ofis ~~$593~~impractical,~~000.~~ ~~These~~other ~~changes~~risk-mitigating ~~are~~measures ~~more~~shall ~~fully~~be ~~described~~taken inas ~~the~~described ~~separate segment analyses~~ below.

~~Interest~~● ~~income (expense)~~Regular, ~~net.~~periodic ~~Interest income~~testing ~~(expense),~~of ~~net~~employees ~~increased~~for ~~in the fiscal year ended October 31, 2021, compared to the fiscal year ended October 31, 2020, by $164,000 due to the interest income from the CRA tax credits~~COVID-19.

~~Other~~● ~~income~~Universal ~~(expense),~~symptom ~~net. Other income (expense)~~monitoring, ~~net~~including ~~increased~~temperature ~~for the year ended October 31, 2021, compared to the fiscal year ended October 31, 2020, as a result of the forgiveness of the two PPP loans in an aggregate amount of $2,391,359~~screening.

~~Loss~~● ~~from~~Appropriate ~~discontinued~~Personal ~~operations,~~Protective ~~net.~~Equipment ~~Loss~~(“PPE”) ~~from~~will ~~discontinued operations,~~be ~~net~~provided ~~decreased by $2,829,000 for the fiscal year ended October 31, 2021, compared~~ to ~~the fiscal year ended October 31, 2020, due to the sale of CTM which resulted in CTM no longer being consolidated with the Company as of February 15, 2021~~employees.

~~Gain~~● onInfection ~~sale~~prevention ofmeasures ~~discontinued~~have ~~operations~~been ~~increased~~developed byand $2applied,~~132~~ including,~~000 for~~ ~~the~~enhanced ~~fiscal~~sanitation ~~year~~(high-touch ~~ended~~wipe ~~October 31~~down, ~~2021,~~disinfection ~~compared~~of ~~to the fiscal year ended October 31~~equipment), ~~2020,~~and ashand ahygiene ~~result~~(increased ofalcohol-based ~~the~~hand ~~sale of CTM.~~sanitizer)

~~Liquidity and Capital Resources~~ Employees

~~General~~As of January, 17, 2023, the Company had 84 full-time United States employees and 1 part-time employee, including 67 full-time employees and 1 part-time employee at IDWP, 7 full-time employees at IDWE, and 10 full-time employees at IDW Media Holdings.

AtItem ~~October~~1A. ~~31,~~Risk ~~2021, we had cash and cash equivalents of $17,532,000 and working capital (current assets in excess of current liabilities) of $19,582,000~~Factors.

WeRISK anticipate that our expected cash inflows from operations during the next twelve months together with our working capital, including the balance of cash and cash equivalents held as October 31, 2021, will be sufficient to sustain our next year of operations.FACTORS

WeOur ~~satisfy~~business, ~~our~~operating ~~cash~~results ~~requirements~~or ~~primarily through~~financial ~~cash~~condition ~~provided~~could be materially adversely affected by any of the ~~Company’s~~following ~~financing~~risks ~~and~~associated ~~operating~~with ~~activities~~any one of our businesses, as well as the other risks highlighted elsewhere in this document. AsThe ~~more~~trading ~~fully~~price ~~discussed~~of ~~below,~~our ~~additional~~common ~~sources~~stock could decline due to any of ~~financing~~these risks. ~~will~~Note bethat ~~needed~~references to ~~finance~~“our”, ~~growth~~“us”, of“we”, ~~IDWE~~“the Company”, etc. used in each risk factor below refers to the business about which such risk factor is provided.

	Fiscal years ended October 31,
(in thousands)	2021			2020
Cash flows provided by (used in):
Operating activities	$	10,637		$	15,989
Investing activities		(1,734	)		(350	)
Financing activities		(3,572	)		(13,642	)
Effect of exchange rate changes on cash and cash equivalents		39			-
Net increase in cash and cash equivalents	$	5,370		$	1,997

Risks Associated with Our Businesses

23We have a history of continued operating losses at IDWE and IDWP and cannot be certain of our future profitability.

~~Operating~~We ~~Activities~~had accumulated a net deficit through October 31, 2022, of approximately $81.5 million. Prior to the CTM Sale, which closed on February 15, 2021, and until the start of the COVID-19 pandemic in March 2020, we often used cash flows from CTM to partially provide funding for corporate overhead and for our IDWP and IDWE operations. In fiscal 2022, on a consolidated basis, the Company had negative cash flows of $7.5 million. In fiscal 2021, the Company on a consolidated level generated positive cash flow of $5.4 million, as a result of net proceeds from the offering closed on August 6, 2021, of $9.4 million.

~~Our~~We ~~cash~~may ~~flow~~incur ~~from~~losses ~~operations~~in the ~~varies~~foreseeable ~~from~~future ~~year to~~as ~~year,~~we ~~depending~~invest onin our ~~operating~~IDWE ~~results~~and IDWP businesses and operations. IDWE’s revenues depend on the ~~timing~~delivery of ~~operating~~properties and ~~cash~~provision ~~receipts~~of services, which can vary significantly from period to period and ~~payments,~~be ~~specifically~~unpredictable. ~~trade~~While ~~accounts~~in ~~receivable~~certain prior periods, our ~~and~~Chairman ~~trade~~of ~~accounts~~the ~~payable.~~Board ~~Cash~~from ~~flows~~time to time provided byus ~~operating~~with ~~activities~~financing ~~was~~on ~~$10,637,000~~favorable terms and ~~$15~~conditions,~~989,000~~ ~~for~~there ~~the~~is ~~fiscal~~no ~~years~~guarantee ~~ended~~that ~~October~~we will 31be able to secure financing from our Chairman of the Board or other sources in the future, ~~2021~~or, ~~and~~if ~~2020~~available, ~~respectively.~~the ~~Some~~terms ofon ~~this~~which ~~was~~such ~~attributed~~financing may tobe ~~IDWE~~provided. The time required for ~~cash~~us ~~receipts~~to ofbecome ~~$300~~profitable is uncertain,~~000~~ and ~~$804,000~~there incan ~~fiscal~~be ~~2021~~no ~~and~~assurance ~~2020,~~that we will obtain the financing ~~respectively~~required ~~for~~or ~~Dirk~~achieve ~~Gently,~~profitability $4on a sustained basis,~~000,000~~ ~~received~~if inat ~~fiscal~~all. ~~2020~~We ~~for~~expect that our results of operations may also fluctuate significantly in the ~~delivery~~future as a result of ~~Locke~~a &variety ~~Key~~of ~~season~~factors, 1including, $5without limitation: the impact of the COVID-19 pandemic,~~315,000~~ the ability to ofsell ~~tax~~comic ~~credits~~books, ~~received~~graphic innovels, ~~fiscal~~television ~~2021~~and other media related sales to Vminimize ~~Wars~~the ~~and~~lag ~~October~~from ~~Faction,~~negotiations ~~and~~to ~~$232~~then sell in various theater forms as noted above with a quick enough turn around rate to establish profitability; our ability to attract,~~000~~ retain and ~~$439,000~~motivate qualified ~~received~~personnel; specific economic conditions in ~~fiscal 2021~~the entertainment and ~~2020,~~publishing ~~respectively~~markets; ~~for~~and ~~Wynonna~~general ~~Earp~~economic conditions.

~~Investing~~We ~~Activities~~will likely need additional capital to sustain our operations and will likely need to seek further financing to accelerate our growth, which we may not be able to obtain on acceptable terms or at all. If we are unable to raise additional capital, as needed, the future growth of our business and operations would be severely limited.

~~Our~~A ~~capital~~factor ~~expenditures~~limiting ~~were~~our ~~approximately $832~~growth,~~000~~ including our ability to enter our proposed markets, attract customers, and ~~$420~~develop and deliver our products,~~000~~ is our limited capitalization overall and as compared to other companies in the ~~fiscal~~industry. ~~years~~To ~~ended~~sustain ~~October~~our 31operations, ~~2021,~~we will rely heavily on the stability and ~~2020,~~predictability ~~respectively~~from the publishing business. As these contracts can span out years into the future it allows us to have predictable cash flows and operating stability.

~~Financing~~If ~~Activities~~we are unable to generate sufficient revenue and profits from our operations, we may decide to seek additional financing. It is possible we may need additional capital to bring our operations to a sustainable level over the next 15 months. In fiscal 2022, we raised $0, in fiscal 2021, we raised gross proceeds of $10,350,000 and in fiscal 2020 we raised gross proceeds of $12,300,000 inclusive of $4 million debt-to-equity conversion in equity financing. We believe that, in addition to the capital raised thus far, we may require up to an additional $7 to $10 million to satisfy our operating cash needs for the next 36 months after the raise. The above is premised on current operating metrics as we are aiming to become cash positive in 2024. However, there is no guarantee we will achieve our goal.

During the fiscal years ended October 31, 2021, and 2020, we repaid bank loans in the amounts of $14,204,000 and $26,559,000, respectively. In addition, the Company received PPP loans of $1,195,680 and $1,195,679, respectively related to IDW operations which were both forgiven during the year ended October 31, 2021. We received net cash proceeds of from issuance of Class B common stock in the year ended October 31, 2021, of $9~~,551,000 in connection to our registered public offering and in the year ended October 31, 2020, of $14,596,000 in connection to a private placement of Class B common stock.~~

~~Changes~~We inmay ~~Trade~~also ~~Accounts~~seek ~~Receivables~~additional financing to accelerate our growth. If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of the Company held by existing shareholders will be reduced and our shareholders may experience significant dilution. In addition, new securities ~~Allowance~~may ~~for~~contain ~~Doubtful~~rights, ~~Accounts~~preferences or privileges that are senior to those of our Class B common stock. If we raise additional capital by incurring debt, this will result in increased interest expense. There can be no assurance that acceptable financing necessary to further implement our plan of operation can be obtained on suitable terms, if at all. Our ability to develop our business could suffer if we are unable to raise additional funds on acceptable terms, which would have the effect of limiting our ability to increase our revenues, develop our products, attain profitable operations, which could result in a significant or complete loss of your investment.

~~Trade~~Public ~~accounts~~health ~~receivable~~threats ~~decreased~~could tohave ~~approximately $5,431,000~~an ~~at October 31, 2021, compared to $22,921,000 at October 31, 2020 principally due to changes in the accruals and collection~~adverse ofeffect ~~IDWE~~on ~~revenue, as well as~~ the ~~timing~~Company’s ofoperations receipts of payments of other receivable balances. The allowance for doubtful accounts as a percentage of gross trade accounts receivable was 2.28% at October 31, 2021 compared to 1.40% at October 31, 2020, reflecting the decrease in receivable balances and ~~our~~financial ~~collectible receivable experience~~results.

~~Off~~In early 2020, the spread of the COVID-19 ~~Balance~~virus ~~Sheet~~resulted ~~Arrangements~~in a worldwide pandemic. We are actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential and actual impact on each of our operating segments. While we believe that currently there has been significant improvement due to global and domestic vaccination efforts, we cannot predict the ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and our operations and our customers and partners may continue to be impacted.

WeIn doApril ~~not~~2020, ~~have~~as ~~any~~a ~~“off-balance~~result ~~sheet~~of ~~arrangements~~the COVID-19 pandemic,” IDWP’s asdirect-market ~~defined~~distributor inpaused ~~relevant~~the ~~SEC~~release ~~regulations~~of ~~that~~new ~~are~~product, ~~reasonably~~including ~~likely~~IDWP’s, toalthough ~~have~~such aoperations ~~current~~were orsubsequently ~~future~~restarted. Many ~~effect~~retailers onexperienced ~~our~~closures, ~~financial~~reduced ~~condition~~operations, ~~results~~ or de-prioritization of ~~operations~~entertainment products, ~~liquidity~~such as books and games, ~~capital~~throughout the ~~expenditures~~COVID-19 orpandemic ~~capital~~resulting ~~resources~~in decreased sales of certain of IDWP’s products.

~~Other~~COVID-19 ~~Sources~~continues to impact domestic and ~~Uses~~international printing and shipping. Costs are beginning to level off as of ~~Resources~~the end of 2022 and the strain on the logistics network is easing, but prices and timing are still considerably higher than the pre-pandemic levels.

OnAdditional ~~August 6~~closures, ~~2021~~restrictions, ~~IDWMH~~or ~~closed~~virus aspikes ~~registered~~could ~~public~~have ~~offering~~a ~~of Class~~further Bnegative ~~common~~impact ~~stock~~on ~~and EF~~IDWP’s ~~Hutton,~~distribution aschannels ~~representative~~and ofretail ~~the~~customers. ~~Underwriters~~We ~~exercised~~are ~~the~~unable ~~overallotment~~to ~~option~~accurately ~~included~~predict ~~as part of~~ the ~~offering in~~ full. ~~The~~impact ~~Company sold an aggregate of 2,875,000 shares of~~ that the ~~Company’s~~COVID-19 ~~Class~~pandemic Bwill ~~common~~have ~~stock~~on ~~for~~distributions, ~~gross~~purchasing, ~~consideration~~sales, ~~of $10~~returns,~~350,000 less~~ ~~Underwriters~~cash ~~commissions~~receipts ~~of $724,500~~ and ~~Underwriters~~overall ~~expenses of $75,000~~revenue.

The ~~Company~~COVID-19 ispandemic ~~using~~resulted in the ~~net~~production ~~proceeds~~of wetelevision ~~received from the offering~~shows ~~for~~being ~~the~~periodically ~~following~~suspended ~~purposes:~~depending ~~most~~on ~~heavily~~local ~~for~~governmental ~~the~~authorities ~~development of original IP~~ and ~~the~~regulatory ~~purchase~~requirements ofin ~~associated~~place ~~publishing,~~at ~~media,~~any ~~and~~given ~~merchandise rights~~time. Due to bevarious ~~used across multiple platforms (e.g.~~uncertainties, ~~print, television, new media) as well as supplemental IP acquisition~~including ~~and marketing spend~~the ~~for~~ultimate ~~these~~geographic ~~newly~~spread ~~created~~of IPthe ~~franchises;~~virus, ~~additionally~~the ~~for~~rise ~~technology~~of ~~investment~~variants ~~for~~that ~~our~~may ~~website~~occur, ~~applications,~~the ~~data and business~~severity ~~intelligence;~~of ~~talent~~the ~~investment as we look to expand our kids~~disease, ~~middle~~the ~~grade,~~duration ~~young~~of ~~adult,~~the ~~and family genres~~outbreak, and toactions ~~further~~that ~~diversify into~~may ~~animation;~~be ~~and~~taken toby ~~pursue~~governmental ~~potential acqui-hire and/or bolt-on mergers and acquisition opportunities~~authorities, ~~should~~further ~~such~~production ~~opportunities~~risks could arise.

WeFor doall ~~not~~these have any agreements at this time to potentially acquire other entities or businesses. The foregoing represents our current intentions based upon our present plans and business conditions to use and allocate the net proceeds of this offering. Howeverreasons, the ~~nature,~~COVID-19 ~~amounts~~pandemic ~~and~~could ~~timing~~have ofa ~~our actual expenditures may vary significantly~~material ~~depending~~adverse impact on ~~numerous factors. As a result,~~ our ~~management~~business ~~has~~ and ~~will~~financial ~~retain broad discretion over the allocation of the net proceeds from this offering~~results. We may find it necessary or advisable to use the net proceeds from this offering for other purposes, and we will have broad discretion in the application of net proceeds from this offering. To the extent that the net proceeds we receive from this offering are not immediately used for the above purposes, we intend to invest our net proceeds in short-term, interest-bearing bank deposits or debt instruments.

~~Where~~Any ~~appropriate,~~loss weof ~~evaluate~~key ~~strategic~~personnel ~~investments~~ and ~~acquisitions~~the ~~to complement, expand, and/or enter into new businesses. In considering acquisitions and investments, we search for~~inability ~~opportunities~~ to ~~profitably~~attract ~~grow our existing businesses, to add qualitatively to the range of businesses in our portfolio~~ and toretain ~~achieve operational~~qualified ~~synergies.~~employees Atcould ~~this~~have ~~time,~~a wematerial ~~cannot~~adverse ~~guarantee~~impact ~~that we will be presented with acquisition opportunities that meet our return-~~on~~-investment criteria,~~ ~~or that~~ our ~~efforts to make acquisitions that meet our criteria will be successful~~operations.

We are dependent on the continued services of key executives. The ~~COVID-19~~departure ~~pandemic~~of ~~has~~key ~~had~~personnel awithout ~~negative~~adequate ~~financial~~replacement ~~impact~~could onseverely disrupt our business ~~with~~operations. ~~regard~~Additionally, towe ~~(a)~~need ~~the~~qualified ~~temporary~~managers ~~closure~~and ofskilled ~~IDWP’s~~employees ~~comic~~with ~~book~~industry ~~distributor~~experience ~~due~~ to ~~COVID-19~~operate ~~disruptions,~~our ~~and~~businesses ~~(b) production delays~~successfully. ofFrom ~~IDWE’s~~time ~~television show~~to ~~Wynonna~~time ~~Earp.~~there ~~Its~~may ~~production~~be ~~schedule~~shortages ~~has~~of ~~been~~skilled ~~delayed~~labor which ~~was~~may amake ~~direct~~it ~~result~~more ofdifficult ~~the~~and ~~COVID-19 pandemic~~expensive ~~that~~for ~~had~~us ~~affected~~to ~~virtually~~attract ~~the~~and ~~entire~~retain qualified ~~filmed~~employees. ~~entertainment~~If ~~industry.~~we ~~This~~are ~~production~~unable ~~delay~~to ~~had~~attract ~~negatively~~and ~~impacted the delivery,~~retain ~~which~~qualified inindividuals ~~turn~~or ~~will~~our ~~pushed~~costs ~~out~~to do so increase significantly, our ~~cash~~operations would ~~receipts~~be materially adversely affected.

24Risks Related to IDWP

InIDWP ~~the~~depends ~~fourth~~on ~~quarter~~one ofmain ~~fiscal~~distributor ~~2020~~for weits ~~paid “pull~~direct ~~down”~~market costs pursuant to a previously announced, multi-year agreement with Cineflix related to international sales of Wynonna Earp. Specifically, under this agreement, IDWE purchased the distribution rights to seasons one and ~~two of Wynonna Earp~~ ~~from~~non-direct ~~the~~market ~~current~~publications ~~licensor (Netflix)~~ and ~~has~~such ~~agreed~~dependence tosubjects ~~transfer~~IDWP ~~those rights~~ to ~~Cineflix. Cineflix~~the ~~will~~risk bethat ~~the~~such ~~international~~ distributor of ~~all~~may ~~four~~be ~~seasons~~unable ~~of Wynonna Earp. Due~~ to ~~changes~~perform inits ~~competition as well as the COVID-19 pandemic, the Cineflix deal is~~obligations ~~not expected~~ to ~~contribute as much as originally expected to IDWE’s revenue and operating cash flow in fiscal years 2021 and 2022 as originally anticipated at the inception of the deal~~IDWP.

~~Dividends~~Historically, IDWP depended on Diamond and PRH, to distribute the vast majority of its publications. With the June 2022 change to PRH as IDWP’s direct market distributor, Diamond is now the company’s largest customer in that sales channel, as they have now become a wholesale client of PRH for IDWP products.

In light of the current growth initiatives of the Company, particularly the television property development of IDWE, the Board of Directors determined to continue the suspension of the payment of cash dividends. Projects that have already been approved and commenced are placing demands on the Company’s resources, and management and the Board determined that it was in the best interests of the stockholders to utilize available cash resources for investment in these promising and exciting growth opportunities. This position may continue depending on the timing of projects, the cash generation of the Company’s operations and any financing that the Company may consummate. Decisions as to the payment of dividends in future periods will depend on the financial position, results of operations, prospects and current and projected competing demands for cash resources at the relevant time. The Company continues its position of prudent and conservative cash management and is committed to using all of its resources to maximize shareholder value, balancing short, medium and long-term interests.10

~~Item~~PRH 7Ahas distributed substantially all of IDWP’s products to non-direct market accounts (i. ~~Quantitative~~e., bookstores, libraries, mass market) and, commencing in June 2022 began distributing to all of IDWP’s direct market accounts. Should PRH fail to perform its distribution obligations under the applicable distribution agreement or to experience financial difficulties that would hinder performance, distribution to the direct or non-direct market, respectively, would be significantly impaired in the short term, and ~~Qualitative~~IDWP’s ~~Disclosures~~ability ~~about~~to ~~Market~~distribute ~~Risks~~and receive proceeds from its publications would be impaired which would have a material adverse impact on our business, prospects and financial condition.

~~FOREIGN~~IDWP ~~CURRENCY~~may ~~RISK~~not be able to respond to changing consumer preferences and its sales may decline.

~~IDWE~~IDWP isoperates ~~the~~in ~~obligor~~highly oncompetitive ~~certain~~markets that ~~loans~~are ~~from~~subject ~~Canadian~~to ~~lenders~~rapid ~~that~~change, ~~are denominated~~including changes in ~~CAD~~customer preferences. There isare asubstantial ~~foreign~~uncertainties ~~currency~~associated ~~exchange~~with ~~risk~~IDWP’s efforts to develop successful publications and products for its customers. New fads, astrends, and shifts in popular culture could affect the ~~value~~type of ~~liabilities~~creative ~~denominated~~media consumers will purchase. Content in ~~CAD~~which ~~will~~IDWP ~~fluctuate~~has ~~due~~invested significant resources may fail to ~~changes~~attract significant consumer demand at the time it is published. IDWP regularly makes significant investments in ~~exchange~~new ~~rates~~products that may not be profitable, or ~~which~~whose ~~will~~profitability ~~affect~~may ~~our~~be ~~production~~significantly ~~costs~~lower than IDWP has experienced historically. A loss in sales due to the foregoing could have a material adverse effect on IDWP’s business, prospects and financial condition.

Foreign Exchange Balances Held in CAD ( in thousands)	October 31, 2021		October 31, 2020
Cash and cash equivalents	$	85	$	937
Accounts receivable		-		16,355
Bank loans		-		18,917

IDWP’s publications may be less successful than anticipated.

~~Item~~IDWP 8cannot accurately predict the commercial success of any of its publications because the revenue derived from the distribution of a publication depends primarily upon its acceptance by the public, which cannot be accurately predicted. ~~Financial~~ ~~Statements~~The commercial success of a publication also depends upon the public’s acceptance of competing publications, critical reviews, the availability of alternative forms of entertainment and ~~Supplementary~~leisure time ~~Data~~activities, piracy and unauthorized distribution of publications, general economic conditions, and other tangible and intangible factors, none of which can be predicted with certainty. Additionally, if the movies or television programs that IDWP licenses are not successful, or if the characters that IDWP licenses lose some of their popularity, IDWP’s ability to sell publications based on such characters would decline, which could have a material adverse effect on IDWP’s business, prospects and financial condition.

~~The~~Significant ~~consolidated~~returns ~~financial statements~~ of ~~the~~IDWP ~~Company and the report~~products ofsold ~~the~~to ~~independent~~mass ~~registered~~market ~~public~~stores ~~accounting~~may ~~firm~~have ~~thereon~~a ~~starting~~material impact on ~~page~~IDWP’s ~~F-1~~cash ~~are included herein~~flow.

~~Item~~Through 9its distribution arrangement with PRH, IDWP sells its publications to bookstores, such as Barnes & Noble, in which PRH allows to be on a fully returnable basis. ~~Changes~~ As a result, these customers can return publications to PRH for credit, which in turn is charged back to IDWP. There is no time limit on the customers’ right to return publications distributed to them. In addition to IDWP being charged back the wholesale cost of the publications, IDWP also incurs a return processing fee by PRH. Such returns and ~~Disagreements~~fees ~~with~~are ~~Accountants~~credited against IDWP’s current sales revenue from PRH, which reduces IDWP’s cash flow and operating capital. Product returns are a normal part of book publishing and IDWP estimates and records a reserve for such returns based on ~~Accounting~~its return history and ~~Financial~~current ~~Disclosure~~trends that are expected to continue. A significant over-estimation of demand for a publication by the mass market bookstores, however, could result in a larger-than-expected volume of returns that would significantly reduce IDWP’s cash flows and operating capital. Further, a general downturn in the economy may also result in significant returns as bookstores reduce their outstanding debts to improve their own cash flow. Any or all of these events that result in significant returns in excess of IDWP’s estimates could have a material adverse effect on IDWP’s revenue, cash flow and operating results.

~~None~~If IDWP fails to maintain positive relationships with its key licensors, authors, illustrators and other creative talent, as well as to develop relationships with new licensors and creative talent, its business could be adversely affected.

~~Item~~IDWP’s 9Abusiness is highly dependent on maintaining strong relationships with the entertainment companies that license their entertainment properties to IDWP, and with authors, illustrators and other creative talent who produce the products that are sold to IDWP’s customers. ~~Controls~~Any weakening of these relationships, or the failure to develop successful new relationships, could have an adverse impact on IDWP’s business and ~~Procedures~~financial performance. Effective January 1, 2023, our licenses for Transformers and GI Joe titles terminated. While the cancellation of the licenses for Transformers and GI Joe are anticipated to decrease revenues by approximately $1.2 million in fiscal year 2023, IDWP plans to mitigate the loss of revenue by enhancing our other key licensed brands through new initiatives for Star Trek, Godzilla, Dungeons & Dragons, and My Little Pony and an expansion of Teenage Mutant Ninja Turtles: The Last Ronin. We expect these efforts to offset any material impact on our gross margin from the loss of the licensed titles.

~~Evaluation of Disclosure Controls and Procedures~~ 11

~~Our~~IDWP ~~Chief~~depends ~~Executive~~on ~~Officer~~freelance creators ~~and~~who ~~Principal~~choose ~~Financial~~how ~~Officer~~to ~~have~~spend ~~evaluated the~~their ~~effectiveness~~time ~~of the design~~ and ~~operation~~utilize oftheir ~~our~~talents. ~~disclosure~~It ~~controls~~is ~~and~~important ~~procedures~~for ~~(as~~IDWP ~~defined~~to inmaintain ~~Rules~~strong ~~13a-15(e)~~relationships ~~and 15d-15(e) of~~with ~~the~~those ~~Securities~~freelance ~~Exchange Act of 1934~~creators, asso ~~amended),~~they asdevote oftheir ~~the~~time ~~end~~and oftalent ~~the~~to ~~period~~IDWP’s ~~covered by this Annual Report on Form 10-K~~projects. ~~Based~~IDWP’s oninability ~~this evaluation,~~to ~~our~~maintain ~~Chief Executive Officer~~ and ~~Principal~~secure these ~~Financial~~relationships ~~Officer~~could have ~~concluded~~a ~~that~~material ~~our~~adverse ~~disclosure~~effect ~~controls~~on ~~and~~IDWP’s ~~procedures~~business, ~~were effective~~prospects atand ~~the~~financial ~~reasonable assurance level as of October 31, 2021~~condition.

~~Changes~~The competitive pressures IDWP faces in ~~Internal~~its ~~Control~~business ~~over~~could ~~Financial~~adversely ~~Reporting~~ affect its financial performance and growth prospects.

~~There~~IDWP ~~were~~is nosubject to significant ~~changes~~competition, including ~~made~~from inother ~~the~~publishers, ~~Company’s~~many ~~internal~~of which are substantially larger than IDWP and have much greater resources than it, such as Marvel ~~control~~Comics ~~over~~and ~~financial~~DC ~~reporting~~Comics. ~~during~~To the ~~fourth~~extent ~~quarter~~IDWP ofcannot meet the ~~year~~challenges ~~ended~~from ~~October 31,~~existing ~~2021~~or ~~that~~new ~~have~~competitors ~~materially~~or ~~affected,~~develop ornew product offerings ~~are~~to ~~reasonably~~meet ~~likely~~customer topreferences ~~materially~~or ~~affect~~needs, ~~the~~its ~~Company’s~~revenues ~~internal~~and ~~control~~profitability ~~over~~could ~~financial~~be ~~reporting~~materially and adversely affected.

~~Attestation~~IDWP ~~Report~~cannot ofcontrol ~~the~~certain ~~Registered~~publication delays, ~~Public~~cancellations ~~Accounting~~and ~~Firm~~shipping delays which could adversely affect IDWP’s sales and its ability to meet delivery obligations.

~~This~~IDWP ~~Annual~~does ~~Report~~not control the decision to proceed with the production of publications based on ~~Form~~characters ~~10-K~~that it licenses from others, and it does not ~~include~~have anfull control ~~attestation~~of ~~report~~ the timing of ~~our~~the ~~independent~~releases ~~registered~~of ~~public~~those ~~accounting~~publications, ~~firm~~which ~~due~~are often the subject to long and inflexible schedules. Disruptions, delays or cancellations to those schedules (especially those connected to COVID-19-related supply and logistics issues) could cause IDWP to incur additional costs, miss an ~~exemption~~anticipated ~~established~~publication bydate, endure long periods without publishing a publication or all of the ~~JOBS~~above, which ~~Act~~could ~~for~~hurt ~~“emerging~~IDWP’s ~~growth~~associated ~~companies~~licensing programs and business.”

~~Item~~IDWP ~~9B.~~cannot ~~Other~~control ~~Information~~the increased industry costs in shipping, printing and paper which in turn impact profitability.

~~None~~Since 2020, the cost of shipping internationally has increased more than 50% above the long-term trend, established since the last recession in 2004, and is expected to continue to rise through 2022. Prices are expected to stabilize in 2023, but at a higher rate than previously seen in the industry. The strong demand for consumer goods is clogging transportation networks worldwide leading to the increased costs to ship internationally. Additionally, once on US soil the goods are subject to increased rail or trucking costs, roughly 23% over 2020. Increased capacity allows transporters to have leverage to continue to increase prices when negotiating contracts, affecting not only trucks and rail, but also seeping into warehouse costs as the supply-chain bottlenecks continue to squeeze capacity.

Additionally, rising labor costs are contributing to the increased costs in transportation, printing, and paper, across the industry. As well as, an influx of publishers moving their printing to domestic printers, due to the global shipping costs & delays, causing domestic prices to rise due to capacity concerns on press. With a push from the big 5 US Publishers domestic printers are investing heavily in staff and equipment to increase capacity, but it is not expected to reach the same capacity highs seen in the early 2000’s. This increase in capacity should, however, begin to create more competition in the domestic printing market, leading to lower prices in both the domestic and overseas markets overall. The cost of paper has been steadily rising for the last several years due to consolidation of plants and changing operations to accommodate the consumer shipping industry. However, as of the end of 2022, the paper market has begun to stabilize, and many manufacturers are finally showing a small percentage of surplus as they prepare for 2023. This surplus suggests price increases should slow through 2023 compared with the quarterly paper increases seen throughout 2021 and 2022. Foreign paper markets are less affected by the paper market increases as China is the largest producer of paper in the world. Any increase in such costs will impact the Company’s profitability.

IDWP depends on the internal controls of its distributor for its financial reporting and revenues.

Because of PRH’s role as the distributor of IDWP’s publications and the fact that much of IDWP’s inventory is held at its distributor’s facilities, IDWP depends on the distributors to implement internal controls over financial reporting and to provide IDWP with information related to those internal controls. PRH’s internal controls might not be sufficient to allow IDWP to meet its internal control obligations or to allow IDWP’s management to properly assess those controls. The distributors may fail to cure any internal control deficiencies related to the publications that it distributes. IDWP may be unable to effectively create compensating controls to detect and prevent errors or irregularities in the distributors’ accounting to IDWP and others. Errors in properly tracking publication sales could also negatively impact IDWP’s revenues.

IDWP might lose sales and revenue because of piracy of publications.

IDWP’s dependence on printers outside the United States subjects it to the risks of international business.

Risks Related to IDWE

IDWE does not control the decisions to produce shows and relies on outside streamers/studios for greenlighting, and if an insufficient number of our properties are put into production, our profitability will be significantly impacted.

Since IDWE does not finance production for film or television, it ultimately rests on the buyers (specifically streamers and studios) of the projects we are developing and seeking to produce to both greenlight and finance productions. Our revenues and profitability are thus dependent on those parties’ decisions.

Reduction in budgets for content could impact our ability to sell television shows which could materially impact revenue and operating results at IDWE.

Increased competition coupled with slower growth and huge losses indicated presage that there may be a reduction in the streaming business’ addressable market. In an attempt to reduce costs, many streamers reduced the number of employees, and vowed to reduce their content spend. Reduction in budgets for content could impact our ability to sell TV shows which could materially impact revenue and operating results at IDWE.

The end of a peak period of investment could materially impact revenue and operating results at IDWE.

The entertainment industry is experiencing reductions in both the number of scripted shows being ordered and the amount spent on content. An emerging decline in advertising spending is an additional obstacle that may adversely impact our ability to sell our IPs to companies that produce television content, which could materially impact revenue and operating results at IDWE.

Viewership and revenue declines in historically profitable television programming companies limits their ability to purchase our IP.

The advancing decline in both cable television and linear broadcast television business models and revenue generation limits their ability to purchase our IP, which could materially impact revenue and operating results at IDWE.

Increased costs for programming and other rights, as well as judgments we make on the potential performance of IDWE’s content, may adversely affect IDWE’s profits and balance sheet.

Due to increased costs for programming and other rights, IDWE shifted its investment strategy in content during the 2021-2022 calendar years – evolving its strategy to not fully fund or finance the productions of television shows or feature films. While the business model of fully funding these productions can present significant upside, it is also a major risk. That being said, as a result of being more cost conscious, IDWE’s capital it spends on developing properties for media opportunities could ultimately be exhausted in any given year due to rising costs of talent and rights. As a result, IDWE might find itself in a position where it is unable to fund additional development or secure the talent required to take a project forward, and adversely affect its ability to build a significant slate of opportunities for sales to buyers.

The competitive pressures IDWE faces in its business could adversely affect its financial performance and growth prospects.

IDWE is subject to significant competition, including from other studios/producers/distributors many of which operate with significantly larger staffs and funding than IDWE. Competitors include (i) smaller independent studios such as Entertainment One, Blumhouse, iTV, Annapurna and Miramax, (ii) major independent studios such as Sony TV and Warner Bros TV, (iii) vertically integrated studios such as Twentieth Television, Universal TV, CBS TV Studios and ABC Studios who develop, distribute and produce original television programming and; (iv) other entertainment divisions of comic book or graphic novel publishers such as Dark Horse, Oni Press, Image and BOOM who develop and produce television and film based on their publishing company’s slate of IP. To the extent IDWE cannot meet the challenges from existing or new competitors or develop new product offerings to meet customer preferences or needs, its revenues and profitability could be adversely affected.

The public health risk of COVID-19 and its impact on productions could adversely affect IDWE’s business.

Multiple television productions of IDWE had been delayed due to the COVID-19 pandemic.

Given the potential public health risk of COVID-19 and related possible imposition of new local, state and federal guidelines limiting the filming and production of our live-action shows, IDWE could be adversely affected and experience significant production delays or cancellations. Production costs of IDWE shows may also rise as additional safety protocols related to the COVID-19 pandemic are necessary on the set of these shows.

Risks Related to Our Intellectual Property

The success of our businesses is highly dependent on the existence and maintenance of intellectual property rights in the publishing and entertainment products and services we create.

The unauthorized use of our intellectual property may increase the cost of protecting our rights in our intellectual property or reduce our revenues. The unauthorized distribution and access to content generally continues to be a significant challenge for intellectual property rights holders. Inadequate laws or weak enforcement mechanisms to protect entertainment industry intellectual property in one country can adversely affect the results of the Company’s operations worldwide, despite the Company’s efforts to protect its intellectual property rights. COVID-19 may increase incentives and opportunities to access content in unauthorized ways, as negative economic conditions coupled with a shift in government priorities could lead to less enforcement. These developments may require us to devote substantial resources to protecting our intellectual property against unlicensed use and present the risk of increased losses of revenue as a result of unlicensed distribution of our content.

With respect to intellectual property developed by us and rights acquired by us from others, we are subject to the risk of challenges to our copyright, trademark, and patent rights by third parties. Successful challenges to our rights in intellectual property may result in increased costs for obtaining rights or the loss of the opportunity to earn revenue from the intellectual property that is the subject of such challenges .

Our intellectual property rights may not be protected, which could adversely affect our consolidated financial position and results of operations.

Failure to adequately protect and enforce our intellectual property rights could substantially harm our business and operating results.

The success of our business depends in part on our ability to protect and enforce our trademarks, copyrights, trade secrets, and other intellectual property rights. We attempt to protect our intellectual property under trademark, copyright and trade secret laws, and through a combination of confidentiality procedures, contractual provisions and other methods, all of which offer only limited protection.

From time to time, legal action by us may be necessary to enforce our trademarks and other intellectual property rights, to protect our trade secrets, to determine the validity and scope of the intellectual property rights of others or to defend against claims of infringement or invalidity. Such litigation could result in substantial costs and diversion of resources, distract management and technical personnel and negatively affect our business, operating results and financial condition. If we are unable to protect our intellectual property rights, we may find ourselves at a competitive disadvantage to others who need not incur the additional expense, time and effort required to create the innovative products that have enabled us to be successful to date. Any inability on our part to adequately protect our intellectual property may have a material adverse effect on our business, operating results, and financial condition.

Risk Factors Generally Relating to Us and Our Class B Common Stock

There can be no assurances that our Class B common stock will not be subject to potential delisting if we do not continue to maintain the listing requirements of the NYSE American.

Although we do not intend to utilize the “controlled company” exemption that may now or in the future be afforded to us by the NYSE American, we may do so in the future which could limit or reduce the effectiveness of our corporate governance.

The Trusts (as defined below) collectively hold shares that represent approximately 58.6% of the combined voting power of our outstanding stock as of January 17, 2023. See “Eight trusts for the benefit of sons and daughters of Howard S. Jonas, our Chairman of the Board of Directors, hold shares that, in the aggregate, represent more than a majority of the combined voting power of our outstanding capital stock, which may limit the ability of other stockholders to affect our management”, below, and “Holders of our Class B common stock have significantly less voting power than holders of our Class C common stock”, below.

If we currently or in the future qualify as a “controlled company,” we do not intend to rely on any applicable exceptions from the NYSE American’s corporate governance listing requirements available to us because we are at that time a “controlled company.” However, there can be no assurance that we will not in the future, if at that time we are a “controlled company,” rely on any or all of the exceptions from the NYSE American’s corporate governance listing requirements available to us because we are a “controlled company.” If we do rely on any or all of the exceptions from the NYSE American’s corporate governance listing requirements because we are then a “controlled company,” the effectiveness of our corporate governance could be limited or reduced.

Our multi-class structure may render our shares ineligible for inclusion in certain stock market indices, and thus adversely affect the share price of our Class B common stock and its liquidity.

We have issued and outstanding shares of Class B common stock and shares of Class C common stock. Our multi-class structure may render our shares ineligible for inclusion in certain stock market indices, which may adversely affect the share price of our Class B common stock and its liquidity.

There is a limited trading market for shares of our Class B common stock and stockholders may find it difficult to sell our shares.

Our Class B common stock may be subject to the penny stock rules that impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and accredited investors. The SEC regulations generally define a penny stock to be an equity that has a market price of less than $5.00 per share, subject to certain exceptions. If we do not retain a listing on NYSE American and if the price of our Class B common stock is less than $5.00, our Class B common stock will be deemed a penny stock. Unless an exception is available, those regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated therewith and impose various sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors (generally institutions and high net worth individuals). In addition, the broker-dealer must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. Moreover, broker-dealers who recommend such securities to persons other than established customers and accredited investors must make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to transactions prior to sale. Regulations on penny stocks could limit the ability of broker-dealers to sell our Class B common stock and thus the ability of purchasers of our Class B common stock to sell their shares in the secondary market.

We cannot predict the extent to which investor interest in us and our Class B common stock will lead to the development or continuance of an active trading market or how liquid that trading market for our Class B common stock might become. If an active trading market for our Class B common stock does not develop or is not sustained, it may be difficult for investors to sell shares, particularly large quantities, of our Class B common stock at a price that is attractive or at all. As a result, an investment in our Class B common stock may be illiquid and investors may not be able to liquidate their investment readily or at all when they desire to sell.

There is limited liquidity in our Class B common stock, which may adversely affect your ability to sell your shares of our Class B common stock.

The market price of our Class B common stock may fluctuate significantly in response to a number of factors, some of which are beyond our control. These factors include, but are not limited to:

●

developments concerning intellectual property rights and regulatory approvals relating to us;

●

quarterly variations in our business and financial results or the business and financial results of our competitors;

●

the ability or inability of us to generate increases in revenue and operate profitably;

●

the ability or inability of us to raise capital, if needed, and the terms and conditions associated with any such raising of capital;

●

developments in our industry and target markets;

●

the number of market makers who are willing to continue to make a market in our stock and the market or exchange on which they decide to make a market in our stock;

●

our ability to have our Class B common stock continue to be listed on the NYSE American; and

●

general market conditions and other factors, including factors unrelated to our own operating performance.

In recent years, the stock market in general has experienced extreme price and volume fluctuations. Continued market fluctuations could result in extreme volatility in the price of shares of our Class B common stock, which could cause a decline in the value of our shares. Price volatility may be accentuated if trading volume of our Class B common stock is low, which historically has often been the case. The volatility in our Class B stock may be combined with low trading volume. Any or all of these above factors could adversely affect your ability to sell your shares of our Class B common stock or, if you are able to sell your shares, to sell your shares at a price that you determine to be fair or favorable.

We have no future plans to pay dividends on our Class B common stock.

We do not pay, and do not intend to pay, cash dividends on our Class B common stock. We currently intend to retain all available funds and any future earnings for use in the operation and expansion of our businesses and do not anticipate paying any cash dividends in the foreseeable future. In addition, the terms of our current, as well as any future, financing agreements may preclude us from paying any dividends. As a result, capital appreciation, if any, of our Class B common stock will be investors’ sole source of potential gain for the foreseeable future.

We are a “smaller reporting company” and an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies and emerging growth companies will make our Class B common stock less attractive to investors.

We are a “smaller reporting company,” as defined in Rule 12b-2 under the Exchange Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including “emerging growth companies” such as, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Our status as a “smaller reporting company” is determined on an annual basis. We cannot predict if investors will find our Class B common stock less attractive or our company less comparable to certain other public companies because we will rely on these exemptions. For example, if we do not adopt a new or revised accounting standard, our future financial results may not be as comparable to the financial results of certain other companies in our industry that adopted such standards. If some investors find our Class B common stock less attractive as a result, there may be a less active trading market for our Class B common stock and our stock price may be more volatile.

If we fail to implement and maintain an effective system of internal controls, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud.

We qualify as an “emerging growth company” as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:

●

an extended transition period to comply with new or revised accounting standards applicable to public companies; and

●

an exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002.

In addition, if we no longer qualify as an emerging growth company, and are considered an accelerated filer, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.

During the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404, we may identify other weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404. If we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, harm our results of operations, and lead to a decline in the trading price of our stock.

Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions. We may also be required to restate our financial statements from prior periods.

The requirements of being a reporting public company may strain our resources, divert management’s attention and affect our ability to attract and retain additional executive management and qualified board members.

As a reporting public company, we will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, and the Dodd-Frank Act, and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, making some activities more difficult, time-consuming or costly. This will put increased demand on our systems and resources, particularly after we are no longer a “smaller reporting company.” The Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to our business and results of operations. As a “smaller reporting company” and “emerging growth company”, as stated above, we receive certain reporting exemptions under The Sarbanes-Oxley Act.

Changing laws, regulations and standards relating to corporate governance and public disclosure create uncertainty for public companies, which increases legal and financial compliance costs and time expenditures for internal personnel. These laws, regulations and standards are subject to interpretation, which in many cases due to their lack of specificity, their application in practice may evolve over time as regulators and governing bodies provide new guidance. These changes may result in continued uncertainty regarding compliance matters and may necessitate higher costs due to ongoing revisions to filings, disclosures and governance practices. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate regulatory or legal proceedings against us, and our business may be adversely affected.

As a public company under these rules and regulations, we expect that it may make it more expensive for us to hire external auditors to perform requisite outside audited financial statements, as well as obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult for us to attract and retain qualified members of our board of directors, particularly to serve on our audit committee and compensation committee and could also make it more difficult to attract qualified executive officers.

As a result of disclosure of information in filings required of a public company, our business and financial condition will become more visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, our business and results of operations could be adversely affected, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and adversely affect our business and results of operations.

General economic conditions may negatively impact our operations.

Economic downturns may negatively affect our operations. These conditions may be widespread or isolated to one or more geographic regions in which we operate. Higher wages, related labor costs, printing costs, leasing costs, energy, insurance and fuel costs and the increasing cost trends in those markets may decrease our margins. Moreover, economic downturns present an additional challenge to us because a significant portion of our revenues are from sales through retail stores, which are more likely to close during economic downturns. In addition, decreases in travel and entertainment spending during economic downturns could impact our businesses, and thereby negatively impact our operations.

Failures in information technology could have an adverse effect on the Company’s operations.

We rely on both internal systems and third parties to provide information technology for many aspects of our business operations. Failures in information technology that could impact the Company’s operations include cybersecurity, business continuity and related operational risks, as well as other security failures or breaches of our internal systems or those of our customers, partners, service providers or other third parties.

We could find it difficult to raise additional capital in the future.

We may need to raise additional capital in order for stockholders to realize increased value on our securities. Given the current global economy, there can be no assurance that we would be able to obtain funding on commercially reasonable terms in a timely fashion. Failure to obtain additional funding, if necessary, could have a material adverse effect on our business, prospects and financial condition.

Holders of our Class B common stock have significantly less voting power than holders of our Class C common stock.

Holders of our Class B common stock are entitled to one-tenth of a vote per share on all matters on which our stockholders are entitled to vote, while holders of our Class C common stock are entitled to three votes per share. Because of their voting power, the holders of our Class C common stock will be able to control matters requiring approval by our stockholders, including the election of all of the directors, amendment of organizational documents and the approval of significant corporate transactions, including any merger, consolidation or sale of all or substantially all of our assets. As a result, the ability of any of the holders of our Class B common stock to influence our management may be limited. In addition, our dual class structure has an anti-takeover effect, and accordingly, the holders of the shares of Class C common stock have the ability to prevent any change in control transactions that may otherwise be in the best interest of stockholders

Eight trusts for the benefit of sons and daughters of Howard S. Jonas, our Chairman and Chairman of the Board, hold shares that, in the aggregate, represent more than a majority of the combined voting power of our outstanding capital stock, which may limit the ability of other stockholders to affect our management.

Eight trusts for the benefit of sons and daughters of Howard S. Jonas (the “Trusts”), our Chairman and Chairman of the Board, collectively have voting power over 1,733,750 shares of our common stock (which includes 545,360 shares of our Class C common stock (which is all the issued and outstanding shares of the Class C common stock), which are convertible into shares of our Class B common stock on a 1-for-1 basis, and 1,188,390 shares of our Class B common stock), representing approximately 58.6% of the combined voting power of our outstanding capital stock, as of January 17, 2023. In addition, as of January 17, 2023, Howard S. Jonas beneficially holds 3,479,934 shares of our Class B common stock, warrants to purchase up to 89,243 shares of our Class B common stock at a price per share of $1.936 and warrants to purchase up to 98,336 shares of our Class B common stock at a price per share of $1.936. Each of the Trusts has a different, independent trustee.

Howard S. Jonas serves as our Chairman, an executive officer position, and Chairman of the Board, which is not an officer position. He is our founder and served as an executive officer, including our Chief Executive Officer, for a very significant time period, and the members of the Board and management often look to him for guidance on major financial, operational and strategic matters.

We are not aware of any voting agreement between or among any of the Trusts and/or Howard S. Jonas, but if such a voting agreement or other similar arrangement exists or were to be consummated, if all or several or all of the Trusts were to act in concert, or if we issued additional Class C common stock, certain or all of the Trusts and/or Howard S. Jonas along with holders of the Class C common stock would be able to control matters requiring approval by our stockholders, including the election of all of the directors, amendment of organizational documents and the approval of significant corporate transactions, including any merger, consolidation or sale of all or substantially all of our assets. As a result, the ability of any of our other stockholders to influence our management may be limited. In addition, our dual class structure has an anti-takeover effect, and accordingly, the holders of the shares of Class C common stock have the ability to prevent any change in control transactions that may otherwise be in the best interest of stockholders.

Item 1B. Unresolved Staff Comments.

None.

Item 2. Properties.

IDW Media Holdings is headquartered at 520 Broad St, Newark, New Jersey, fourth floor. The term of the license agreement with IDT Domestic Telecom Inc. commenced on December 1, 2018 and is month-to-month with 30 days’ prior written notice required for termination by either party. Currently, the annual rental expense is $19,200.

IDWP is headquartered in 3,334 square feet of leased space at 2355 Northside Drive, Suite 140, San Diego, CA. The lease commenced on June 1, 2022 and has a 39-month term which expires on August 31, 2025. The Company pays rent of $126,000 annually, subject to annual escalations of 3%.

IDWE is headquartered in 4,734 square feet of leased space at 14144 Ventura Blvd, Suite 210, Sherman Oaks, CA. The lease commenced on August 1, 2022 and has a 60-month term which expires on July 31, 2027. The Company pays rent of $174,000 annually, subject to annual escalations of 3%.

Item 3. Legal Proceedings.

The Company may from time to time be subject to legal proceedings that may arise in the ordinary course of business. Although there can be no assurance in this regard, other than noted above, the Company does not expect any of those legal proceedings to have a material adverse effect on the Company’s results of operations, cash flows or financial condition.

Item 4. Mine Safety Disclosures.

Not applicable.

Part II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

PRICE RANGE OF COMMON STOCK

Our Class B common stock commenced trading on the NYSE American on August 4, 2021 under the symbol “IDW.”

On January 17, 2023, there were 103 holders of record of our Class B common stock and 8 holders of record of our Class C common stock, which is not publicly traded. These numbers do not include the number of persons whose shares are in nominee or in “street name” accounts through brokers. On January 18, 2023, the last sales price reported on the NYSE American for the Class B common stock was $1.0345 per share.

We have not paid dividends on our Class B common stock, and currently do not intend to pay any cash dividends on our Class B common stock in the foreseeable future. Our current policy is to retain all of our earnings to finance future growth. Any future declaration of dividends will be subject to the discretion of our Board of Directors.

In addition, we may incur debt financing in the future, the terms of which will likely prohibit us from paying cash dividends or distributions on our Class B common stock. Even if we are permitted to pay cash dividends in the future, we currently anticipate that we will retain all future earnings, if any, to fund the operation and expansion of our business and for general corporate purposes.

The information required by Item 201(d) of Regulation S-K will be contained in our Proxy Statement for our Annual Stockholders Meeting, which we will file with the Securities and Exchange Commission within 120 days after October 31, 2021, and which is incorporated by reference herein.

Performance Graph of Stock

We are a smaller reporting company as defined by Rule 12b-2 of the Securities and Exchange Act of 1934 and are not required to provide the information under this item.

Issuer Repurchases of Equity Securities

None.

Item 6. [Reserved].

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report.

Critical Accounting Policies

Our consolidated financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses as well as the disclosure of contingent assets and liabilities. Critical accounting policies are those that require application of management’s most subjective or complex judgments, often as a result of matters that are inherently uncertain and may change in subsequent periods. Our critical accounting policies include those related to the allowance for doubtful accounts, goodwill, valuation of long-lived assets including intangible assets with finite useful lives and ultimate revenues for television costs. Management bases its estimates and judgments on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. See Note 1 to the consolidated financial statements in this Annual Report for a complete discussion of our significant accounting policies.

Results of Operations

We evaluate the performance of our operating business segments based primarily on income (loss) from operations. Accordingly, the income and expense line items below loss from operations are only included in our discussion of the consolidated results of operations.

IDWP

(in thousands)							Change
Fiscal Year ended October 31,	2022			2021			$			%
Revenues	$	25,839		$	25,284		$	555			2.2	%
Direct cost of revenues		13,993			13,682			311			2.3	%
Selling, general and administrative		13,458			12,169			1,289			10.6	%
Depreciation and amortization		285			203			82			nm
(Loss) income from operations	$	(1,897	)	$	(770	)	$	(1,127	)		(146.4	)%

nm—not meaningful

Revenues. Revenues increased $555,000 in the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021, primarily due to an increase in games revenue of $1,716,000 driven by fulfillment of the direct-to-consumer games campaign for Batman Adventures, an increase in retailer exclusive revenue of $1,200,000 predominately related to Sonic the Hedgehog and Transformers, an increase in non-direct market publishing revenue of $603,000 driven by strong Teenage Mutant Ninja Turtles: The Last Ronin and They Called Us Enemy sales, a decrease in sales returns and discounts on book sales of $474,000, and an increase in other licensing and royalty revenues of $44,000, partially offset by a decrease in direct market publishing revenue of $3,055,000 due to fewer titles being released during the period, and a decrease in digital sales of $427,000. Sales returns for fiscal 2022 improved compared to the prior year due to targeted incentives with accounts to reduce return rates, localization of inventory management at Barnes & Noble, and COVID-19 related pressures in fiscal 2021.

Effective January 1, 2023, our licenses for Transformers and GI Joe titles have been terminated. While the cancellation of the licenses for Transformers and GI Joe are anticipated to decrease revenues by approximately $1.2 million in fiscal year 2023, IDWP plans to mitigate the loss of revenue by enhancing our other key licensed brands through new initiatives for Star Trek, Godzilla, Dungeons & Dragons, and My Little Pony and an expansion of Teenage Mutant Ninja Turtles: The Last Ronin. We expect these efforts to substantially offset any material impact on our gross margin from the loss of the licensed titles.

During calendar 2021, we significantly wound down IDW Games and IDW Games is now only backfilling already developed games. The decision to shut down games was due to its lack of profitability, despite outliers like Batman Adventures, noted above.

Direct cost of revenues. IDWP’s direct cost of revenues increased by $311,000 in the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021, primarily due to an increase in printing expenses and creative costs for IDW Games of $430,000 which corresponds to the increase in revenue from games noted above and an increase in publishing printing costs of $626,000, offset by a decrease in royalty expenses of $558,000, a decrease in publishing creative costs of $152,000, and a decrease in digital and licensing costs of $35,000. Although costs were recognized for fulfillment of the Batman Adventures game in the current year, future games costs will only be recognized with individual customer orders. Royalty expense as a percentage of sales is dependent on product and title mix as different revenue streams and titles have different royalty rates.

Gross Margin. IDWP’s gross margin for the fiscal year ended October 31, 2022 was essentially flat at 45.8% compared to 45.9% for the fiscal year ended October 31, 2021.

Selling, General and Administrative. IDWP’s selling, general and administrative expenses increased by $1,289,000 in the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021, primarily due to increases in marketing expenses of $847,000, IT costs of $481,000 related to the Company’s website for the focus on direct-to-consumer and dues and subscriptions, shipping and direct-to-consumer costs of $188,000, salaries and benefits of $247,000, and travel expenses of $220,000, partially offset by decreases in severance of $400,000, overhead allocations of $79,000, legal fees of $85,000, occupancy expenses of $66,000, bad debt of $30,000, insurance costs of $30,000, and other net charges of $4,000. The increase in salary and benefits was comprised of an overall increase of $683,000 offset by a $436,000 ERC as a result of the CARES Act recorded as a reduction in payroll tax expense.

As a percentage of IDWP’s revenues, selling, general and administrative expenses in the fiscal year ended October 31, 2022, was 52.1% compared to 48.1% in the fiscal year ended October 31, 2021.

IDWE

(in thousands)						Change
Fiscal year ended October 31,	2022		2021			$			%

Revenues	$	10,255	$	7,141		$	3,114			43.6	%
Direct cost of revenues		2,511		8,101			(5,590	)		(69.0	)%
Selling, general and administrative		4,561		5,694			(1,133	)		(19.9	)%
Depreciation and amortization		34		36			(2	)		nm
Income (loss) from operations	$	3,149	$	(6,690	)	$	9,839			147.1	%

nm—not meaningful

Revenues. IDWE revenues for the fiscal year ended October 31, 2022 increased by $3,114,000 compared to the fiscal year ended October 31, 2021. Revenues in fiscal year 2022, included revenue recognized due to the full delivery of Locke & Key seasons two and three in an amount of $8,944,000, revenue from the full delivery of season one of Surfside Girls of $1,149,000, the French-Canadian license received for V Wars of $119,000, and revenue from optioned projects of $43,000. In fiscal year 2021, revenues included recognition from delivered episodes from Wynonna Earp of $3,496,000, tax credits for V Wars and October Faction of $3,331,000, Lock & Key contingent compensation from season two of $200,000, and foreign receipts from Dirk Gently of $114,000.

Direct costs of revenues. Direct cost of revenues consists primarily of the amortization of production costs that were capitalized during the production of the television episodes and direct costs related to revenue recognized during related periods.

Direct costs of revenues for the fiscal year ended October 31, 2022 decreased by $5,590,000 compared to the fiscal year ended October 31, 2021. The amortized television costs for fiscal year 2022, included costs related to delivered episodes from Locke & Key seasons two and three of $1,875,000 and to full delivery of season one of Surfside Girls of $100,000, executive producing fees of $325,000, cost refinement from October Faction and V Wars of $78,000, inventory write offs of $278,000, residuals of $467,000, agency commission fees of $9,000, and cost of optioned projects of $6,000, offset by cost recoupment from Wynonna Earp of $432,000 and tax credits for V Wars and October Faction of $195,000. The amortized television costs for fiscal year 2021, included delivered episodes from Wynonna Earp of $5,251,000, impairment charges of $2,216,000, cost refinement from October Faction and V Wars of $586,000 and other costs of $48,000.

Gross Margin. IDWE’s gross margin for the fiscal year ended October 31, 2022 was 75.5% compared to negative 13.4% for the fiscal year ended October 31, 2021. These gross margin figures are aligned with the explanations provided for revenues and direct costs of revenues.

Selling, General and Administrative. Selling, general and administrative expenses decreased by $1,133,000 during the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021. The decrease was driven by decreases in consulting costs of $445,000, legal fees of $117,000, marketing of $137,000, salary and benefits of $387,000, recruitment fees of $153,000, professional services of $75,000, severance of $175,000, travel expenses of $41,000 and other net changes of $87,000, offset by increases in overhead allocation of $284,000 and non-cash compensation of $200,000. The decrease in salary and benefits included a $87,000 ERC as a result of the CARES act recorded as a reduction in payroll tax expense.

As a percentage of IDWE’s revenues, selling, general and administrative expenses in the fiscal year ended October 31, 2022, was 44.5% compared to 79.7% in the fiscal year ended October 31, 2021.

IDWMH

(in thousands)							Change
Fiscal year ended October 31,	2022			2021			$			%

Selling, general and administrative	$	1,914		$	1,219		$	695			57.0	%
Depreciation and amortization		23			6			17			nm
Loss from operations	$	(1,937	)	$	(1,225	)	$	(712	)		(58.1	)%

nm—not meaningful

Selling, General and Administrative. Selling, general and administrative expenses increased by $695,000 during the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021. The increase was driven by increases in severance of $468,000, shareholder relations fees of $263,000, insurance costs of $235,000, non-cash compensation of $218,000, travel expenses of $113,000, and marketing expenses of $80,000, offset by decreases in overhead allocation to operating segments of $483,000, legal fees of $131,000, salary and benefits of $60,000, and other net changes of $8,000. The decrease in salary and benefits included a $42,000 ERC as a result of the CARES act recorded as a reduction in payroll tax expense.

Consolidated net loss IDW Media Holdings, Inc.

(in thousands)							Change
Fiscal year ended October 31,	2022			2021			$			%
Loss from continuing operations	$	(685	)	$	(8,685	)	$	8,000			92.1	%
Interest (expense) income, net		(10	)		118			(128	)		(108.5	)%
Other (expense) income, net		(53	)		2,333			(2,386	)		(102.3	)%
Net loss from continuing operations		(748	)		(6,234	)		5,486			88	%
Loss from discontinued operations, net		-			(1,281	)		1,281			100.0	%
Gain on sale of discontinued operations		-			2,123			(2,123	)		(100.0	)%
Net loss	$	(748	)	$	(5,392	)	$	4,644			86.1	%

Loss from operations. Loss from continuing operations decreased by $8,000,000 in the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021, due to increased operating income from IDWE of $9,839,000, offset by an increase in operating loss from IDWP of $1,127,000 and an increase in corporate overhead of $712,000. These changes are described in the separate segment analyses above.

Interest (expense) income, net. Interest (expense) income decreased by $128,000 to interest expense of $10,000 in the fiscal year ended October 31, 2022, compared to interest income of $118,000 in the fiscal year ended October 31, 2021 due to interest income from CRA tax credits received in the fiscal year ended October 31, 2021.

Other (expense) income, net. Other (expense) income decreased by $2,386,000 to other expense of $53,000 in the fiscal year ended October 31, 2022, compared to other income of $2,333,000 in the fiscal year ended October 31, 2021, primarily due to PPP loan forgiveness received in the fiscal year ended October 31, 2021.

Loss from discontinued operations, net. Loss from discontinued operations was $0 for the fiscal year ended October 31, 2022, compared to a loss of $1,281,000 for the fiscal year ended October 31, 2021, due to the sale of CTM which resulted in CTM no longer being consolidated with the Company as of February 15, 2021.

Gain on sale of discontinued operations. Gain on sale of discontinued operations decreased by $2,123,000 for the fiscal year ended October 31, 2022, compared to the fiscal year ended October 31, 2021, as a result of the sale of CTM.

Liquidity and Capital Resources

General

At October 31, 2022, we had cash and cash equivalents of $10,014,000 and working capital (current assets in excess of current liabilities) of $18,476,000.

We anticipate that our expected cash inflows from operations during the next twelve months together with our working capital, including the balance of cash and cash equivalents held as October 31, 2022, which includes proceeds from the offering closed on August 6, 2021, will be sufficient to sustain our operations for at least the twelve months following the date of this report.

We satisfy our cash requirements primarily through cash provided by the Company’s operating and financing activities.

	Fiscal years ended October 31,
(in thousands)	2022			2021
Cash flows (used in) provided by:
Operating activities	$	(6,618	)	$	10,637
Investing activities		(900	)		(1,734	)
Financing activities		-			(3,572	)
Effect of exchange rate changes on cash and cash equivalents		-			39
Net increase in cash and cash equivalents	$	(7,518	)	$	5,370

Operating Activities

Cash flows used in operating activities was $6,618,000 for the fiscal year ended October 31, 2022, compared to cash flows provided by operating activities of $10,637,000 for the fiscal year ended October 31, 2021. For the fiscal year ended October 31, 2022, net use of cash was primarily a result of the net loss for the period of $748,000, adjusted for non-cash expenses of $2,712,000 and cash outflow from changes in assets and liabilities of $8,548,000 as a result of decreases to production costs payable and deferred revenue and increases in trade accounts receivable, inventory, television costs, and prepaid expenses and other assets. For the fiscal year ended October 31, 2021, the net cash provided was primarily a result of cash inflow from changes in assets and liabilities of $19,045,000 as a result of decreases in trade accounts receivable, inventory, and increases in production costs payable, offset by a net loss in the period of $5,392,000 adjusted for non-cash expenses of $8,421,000, cash outflow from changes in assets and liabilities of $6,945,000 as a result of increases in prepaid expenses and television costs and decreases in deferred revenue, and adjustments for non-cash items of $4,515,000 related to the gain on the sale of CTM and gain on the extinguishment of a PPP loan. Cash flows generated at IDWE vary widely year to year due to timing of productions.

Investing Activities

Our capital expenditures were approximately $900,000 and $832,000 in the fiscal years ended October 31, 2022, and 2021, respectively. The fiscal year ended October 31, 2021 also included an unfavorable adjustment of $902,000 related to the disposal of CTM.

Financing Activities

During the fiscal year ended October 31, 2021, IDW repaid bank loans in the amounts of $14,204,000, partially offset by cash received for PPP loans of $1,196,000, and net cash proceeds received of from the issuance of Class B common stock of $9,551,000 in connection to our registered public offering.

Recent Accounting Pronouncements

For a description of recently issued accounting pronouncements, including the respective dates of adoption, and expected effects on our results of operations and financial condition, see Note 1 to the consolidated financial statements included in Item 8 of this Annual Report.

Changes in Trade Accounts Receivables and Allowance for Doubtful Accounts

Trade accounts receivable increased to approximately $6,448,000 at October 31, 2022, compared to $5,431,000 at October 31, 2021 principally due to changes in the accruals and collection of IDWE revenue, as well as the timing of receipts of payments of other receivable balances. The allowance for doubtful accounts as a percentage of gross trade accounts receivable was 0% at October 31, 2022 and 2021, reflecting the Company’s collectible receivable experience.

Off- Balance Sheet Arrangements

We do not have any “off-balance sheet arrangements,” as defined in relevant SEC regulations that are reasonably likely to have a current or future effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.

Other Sources and Uses of Resources

On August 6, 2021, IDWMH closed a registered public offering of Class B common stock and EF Hutton, as representative of the Underwriters exercised the overallotment option included as part of the offering in full. The Company sold an aggregate of 2,875,000 shares of the Company’s Class B common stock for gross consideration of $10,350,000 less Underwriters commissions of $724,500 and Underwriters expenses of $75,000.

The Company is using the net proceeds we received from the offering principally for the development of original IP and the purchase of associated publishing, media, and related rights. Funds are also used for marketing spend for our IP franchises, and additionally for technology investments and our website development. The Company also seeks to pursue potential investment and acquisition opportunities, should such opportunities arise.

We do not have any agreements at this time to potentially acquire other entities or businesses. The foregoing represents our current intentions based upon our present plans and business conditions to use and allocate the net proceeds of this offering. However, the nature, amounts and timing of our actual expenditures may vary significantly depending on numerous factors. We may find it necessary or advisable to use the net proceeds from this offering for other purposes. As a result, our management has and will retain broad discretion over the allocation and application of the net proceeds from this offering. To the extent that the net proceeds we receive from this offering are not immediately used for the above purposes, we intend to invest our net proceeds in short-term, interest-bearing bank deposits or debt instruments.

Where appropriate, we evaluate strategic investments and acquisitions to complement, expand, and/or enter into new businesses. In considering acquisitions and investments, we search for opportunities to profitably grow our existing businesses, to add qualitatively to the range of businesses in our portfolio, and to achieve operational synergies. At this time, we cannot guarantee that we will be presented with acquisition opportunities that meet our return-on-investment criteria, or that our efforts to make acquisitions that meet our criteria will be successful.

The COVID-19 pandemic has had a negative impact on our business in past quarters with regard to (a) issues related to increased costs of international printing, shipping and cost rises, and (b) in 2021 we experienced production delays of IDWE’s television show Wynonna Earp. In the fiscal year 2022, our business as a whole has not suffered any material adverse consequences. The extent of the impact of the COVID-19 pandemic and resulting economic uncertainty could adversely affect our liquidity and capital resources in the future, and cash requirements may fluctuate based on the timing and extent of many factors discussed above.

In the fourth quarter of fiscal 2020 we paid “pull down” costs pursuant to a previously announced, multi-year agreement with Cineflix related to international sales of Wynonna Earp. Specifically, under this agreement, IDWE purchased the distribution rights to seasons one and two of Wynonna Earp from the current licensor (Netflix) and had agreed to transfer those rights to Cineflix. Cineflix is now the international distributor of all four seasons of Wynonna Earp. Due to changes in competition as well as the COVID-19 pandemic, the Cineflix deal did not contribute revenue and operating cash flow in fiscal year 2021 at the levels originally anticipated at the inception of the deal, however in the third quarter of 2022 we began recouping some of our cash outlays.

Dividends

We have never declared or paid any cash dividends on our capital stock. The Company does not currently anticipate paying any cash dividends in the foreseeable future and is using cash flows to invest in the growth of the business.

Item 7A. Quantitative and Qualitative Disclosures about Market Risks.

Foreign Currency Risk

There is a foreign currency exchange risk associated with IDWE’s arrangements with special-purpose entities, formed for the sole purpose of providing production services in Canada, as the value of assets denominated in CAD will fluctuate due to changes in exchange rates, which will affect the Company’s production costs.

Foreign Exchange Balances Held in CAD (in thousands)

		October 31, 2022				October 31, 2021
Cash and cash equivalents		$	170			$	85

Item 8. Financial Statements and Supplementary Data.

The consolidated financial statements of the Company and the report of the independent registered public accounting firm thereon starting on page F-1 are included herein.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A. Controls and Procedures.

Management’s report on internal control over financial reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.

Management’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of Company’s assets that could have a material effect on financial statements.

Because of the inherent limitations, internal control over financial reporting may not prevent or detect misstatements on a timely basis. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of October 31, 2022. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework (2013 Framework).

Based on this assessment, our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has concluded that, as of October 31, 2022, our internal control over financial reporting were effective based on those criteria.

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended), as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of October 31, 2022.

Changes in Internal Control over Financial Reporting

There were no significant changes made in the Company’s internal control over financial reporting during the fourth quarter of the year ended October 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Attestation Report of the Registered Public Accounting Firm

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm due to an exemption established by the JOBS Act for “emerging growth companies.”

Item 9B. Other Information.

None.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

2528

Part III

Item 10. Directors, Executive Officers and Corporate Governance.

The following is a list of our directors and executive officers along with the specific information required by Rule 14a-3 of the Securities Exchange Act of 1934:

Executive Officers

~~Ezra~~Allan YI. ~~Rosensaft~~Grafman—Chief Executive Officer

Brooke T. Feinstein—Chief Financial Officer

Howards S. Jonas—Chairman

Directors

Howard S. Jonas—Chairman of the Board

Sanford R. Climan—Vice Chairman of the Board

Perry Davis

Allan I. Grafman

Amy Jonas

Irwin Katsof

Christopher McGurk

~~The~~Ex-Officio remaining information required by this Item will be contained in our Proxy Statement for our Annual Stockholders Meeting, which will be filed with the Securities and Exchange Commission within 120 days after October 31, 2021, and which is incorporated by reference herein.Directors

Allan I. Grafman

Marc E. Knoller

The remaining information required by this Item will be contained in our Proxy Statement for our Annual Stockholders Meeting, which will be filed with the Securities and Exchange Commission within 120 days after October 31, 2022, and which is incorporated by reference herein.

Corporate Governance

We have included as exhibits to this Annual Report on Form 10-K certificates of our Chief Executive Officer and Principal Financial Officer certifying the quality of our public disclosure.

We make available free of charge through the investor relations page of our web site (http://idwmediaholdings.com/investors/) our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports, and all beneficial ownership reports on Forms 3, 4 and 5 filed by directors, ~~officers~~ officers and beneficial owners of more than 10% of our equity, as soon as reasonably practicable after such reports are electronically filed with the Securities and Exchange Commission. We have adopted codes of business conduct and ethics for all of our employees, including ~~our~~ our principal executive officer, principal financial officer, and principal accounting officer. Copies of the codes of business conduct ~~and~~ and ethics are available on our web site.

Our web site and the information contained therein or incorporated therein are not intended to be incorporated into this Annual Report on Form 10-K or our other filings with the Securities and Exchange Commission.

Item 11. Executive Compensation.

The information required by this Item will be contained in our Proxy Statement for our Annual Stockholders Meeting, which will be filed with the Securities and Exchange Commission within 120 days after ~~October~~ October 31, ~~2021~~2022, and which is incorporated by reference herein.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Item 14. Principal Accounting Fees and Services.

2629

Part IV

Item 15. Exhibits, Financial Statement Schedules.

(a)

The following documents are filed as part of this Report:

Report of Independent Registered Public Accounting Firm on Consolidated and Combined Financial Statements

Consolidated and Combined Financial Statements covered by Report of Independent Registered Public Accounting Firms

Financial Statement Schedule.

All schedules have been omitted since they are either included in the Notes to Consolidated and Combined Financial Statements or not required or not applicable.

Exhibits. The exhibits listed in paragraph (b) of this item are filed, furnished, or incorporated by reference as part of this Form 10-K.

Certain of the agreements filed as exhibits to this Form 10-K contain representations and warranties by the parties to the agreements that have been made solely for the benefit of of the parties to the agreement. These representations and warranties:

◾● may have been qualified by disclosures that were made to the other parties in connection with the negotiation of the agreements, which disclosures are not necessarily reflected in the agreements;

◾● may apply standards of materiality that differ from those of a reasonable investor; and

◾● were made only as of specified dates contained in the agreements and are subject to subsequent developments and changed circumstances.

Accordingly, these representations and warranties may not describe the actual state of affairs as of the date that these representations and warranties were made or at any ~~other~~ other time. Investors should not rely on them as statements of fact.

~~(b) Exhibits.~~30

27 (b) Exhibits.

EXHIBIT INDEX

Exhibit No.		Description of Exhibit
3.1***		Fourth Restated Certificate of Incorporation of IDW Media Holdings, Inc.
3.2*****		Third Amended and Restated Bylaws of IDW Media Holdings, Inc.
3.2****		Fourth Amended and Restated Bylaws of IDW Media Holdings, Inc.
4.1*		Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
4.2**		Warrant to Purchase IDW Media Holdings, Inc. Class B Common Stock issued to Howard S. Jonas, dated August 21, 2018.
4.3**		Warrant to Purchase IDW Media Holdings, Inc. Class B Common Stock issued to Howard S. Jonas, dated March 30, 2019.
4.3*****		Amendment to Warrant to Purchase IDW Media Holdings, Inc. Class B Common Stock issued to Howard S. Jonas, dated March 29, 2022.
4.4**		Warrant to Purchase IDW Media Holdings, Inc. Class B Common Stock issued to Howard S. Jonas, dated March 30, 2019.
4.5*****		Amendment to Warrant to Purchase IDW Media Holdings, Inc. Class B Common Stock issued to Howard S. Jonas, dated March 29, 2022.
10.1**#		IDW Media Holdings, Inc. 2009 Stock Option and Incentive Plan.
10.2**#		IDW Media Holdings, Inc. 2019 Stock Option and Incentive Plan.
10.3**		Share Purchase Agreement between IDW Media Holdings, Inc. and Howard S. Jonas, dated as of July 14, 2020.
10.4**		Loan and Security Agreement between High Park/V-Wars Production, Inc. and Bank Leumi USA, dated June 19, 2018.
10.5**		Royal Bank of Canada Demand credit Facility in favour of Highland Park/October Faction Production Inc., dated November 21, 2018.
10.5******±		Distribution Agreement between Penguin Random House Publisher Services and Idea and Design Works, LLC, dated June 20, 2016.
10.6**±		The Supply Agreement between Idea and Design Works, LLC and Diamond Comic Distributors, Inc., dated September 30, 2013.
10.6*******±		Letter Agreement between the Registrant and Penguin Random House Publisher Services, dated June 15, 2021.
10.7**±		Amendment to the Supply Agreement between Idea and Design Works, LLC and Diamond Comic Distributors, Inc., dated March 1, 2016.
10.7********		Employment Agreement between the Company and Howard S. Jonas, dated April 5, 2022.
10.8**±		Distribution Agreement between Penguin Random House Publisher Services and Idea and Design Works, LLC, dated June 20, 2016.
10.8*********		Employment Agreement between the Company and Allan Grafman, dated August 21, 2022.
10.9****±		Letter Agreement between the Registrant and Penguin Random House Publisher Services, dated June 15, 2021.
10.9**********		Separation and General Release Agreement between the Company and Ezra Y. Rosensaft, dated August 29, 2022.
21.01*		Subsidiaries of the Registrant
23.1*		Consent of Zwick ~~& Banyai~~CPA, ~~PLLC~~LLC, Independent Registered Public Accounting Firm
31.01*		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02*		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01*		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.02*		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		Inline XBRL Instance Document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

*	*	Filed herewith.
**	**	Incorporated by reference to Form S-1/A, filed ~~June~~October 2116, ~~2021~~2020.
***	~~***~~	Incorporated by reference to Form 8-K, filed July 19, 2021.
****	~~****~~	Incorporated by reference to Form 8-K, filed ~~September~~June 3014, ~~2021~~2022.
*****	~~*****~~	Incorporated by reference to Form 8-K, filed ~~December~~April 74, ~~2021~~2022.
	±	Denotes that fees, payment terms and other business terms have been redacted in accordance with Item 601(b)(10)(iv) of Regulation S-K.
******		Incorporated by reference to Form S-1/A, filed April 5, 2021.
	#	Denotes management compensation plan or contract.
*******		Incorporated by reference to Form 8-K, filed September 30, 2021.
********		Incorporated by reference to Form 8-K, filed April 11, 2022.
*********		Incorporated by reference to Form 8-K, filed August 24, 2022.
**********		Incorporated by reference to Form 8-K, filed August 31, 2022.

Denotes that fees, payment terms and other business terms have been redacted in accordance with Item 601(b)(10)(iv) of Regulation S-K.

Denotes management compensation plan or contract.

Item 16. Form 10-K Summary

None.

2831

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

IDW MEDIA HOLDINGS, INC. By: /s/ ~~Ezra~~Allan ~~Rosensaft~~I. ~~Ezra~~Grafman ~~Rosensaft~~Allan I. Grafman Chief Executive Officer (Principal Executive Officer)

Date: January 2019, ~~2022~~2023

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Howard S. Jonas	Chairman of the Board and Chairman	January 2019, ~~2022~~2023
Howard S. Jonas
/s/ Ezra Y. Rosensaft	Chief Executive Officer	January 20, 2022
/s/ Allan I. Grafman	Chief Executive Officer	January 19, 2023
Ezra Y. Rosensaft	(Principal Executive Officer)
Allan I. Grafman	(Principal Executive Officer)
/s/ Brooke T. Feinstein	Chief Financial Officer	January 2019, ~~2022~~2023
Brooke T. Feinstein	(Principal Financial Officer and Principal Accounting Officer)
/s/ Sanford R. Climan	Director	January 20, 2022
/s/ Amy Jonas	Director	January 19, 2023
Sanford R. Climan
/s/ Amy Jonas	Director	January 20, 2022
Amy Jonas
/s/ Perry Davis	Director	January 20, 2022
Perry Davis
/s/ Allan I. Grafman	Director	January 20, 2022
Allan I. Grafman
/s/ Irwin Katsof	Director	January 20, 2022
Irwin Katsof
/s/ Christopher McGurk	Director	January 20, 2022
Christopher McGurk

29/s/ Perry Davis Director January 19, 2023

Perry Davis

/s/ Irwin Katsof

Director

January 19, 2023

Irwin Katsof

/s/ Christopher McGurk

Director

January 19, 2023

Christopher McGurk

IDW Media Holdings, Inc.

Index to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm	F-2
Report of Independent Registered Public Accounting Firm (PCAOB ID 549)		F-2
Consolidated Balance Sheets as of October 31, 2021 and 2020	F-3
Consolidated Balance Sheets as of October 31, 2022 and 2021		F-3
Consolidated Statements of Operations and Comprehensive Loss for the fiscal years ended October 31, 2021 and 2020	F-4
Consolidated Statements of Operations and Comprehensive Loss for the fiscal years ended October 31, 2022 and 2021		F-4 – F-5
Consolidated Stockholders Equity for the fiscal years ended October 31, 2021 and 2020	F-6
Consolidated Stockholders Equity for the fiscal years ended October 31, 2022 and 2021		F-6
Consolidated Statements of Cash Flows for the fiscal years ended October 31, 2021 and 2020	F-7
Consolidated Statements of Cash Flows for the fiscal years ended October 31, 2022 and 2021		F-7
Notes to Consolidated Financial Statements	~~F-8~~	F-8

F-1

~~REPORT~~Report of OFIndependent ~~INDEPENDENT~~Registered ~~REGISTERED~~Public ~~PUBLIC~~Accounting ~~ACCOUNTING FIRM~~Firm

Board of Directors and ~~Stockholders~~Shareholders

IDW Media Holdings, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of IDW Media Holdings, Inc. and its Subsidiaries (the “Company”) as of October 31, ~~2021~~2022 and ~~2020,~~2021 and the related ~~consolidated~~ statements of operations, comprehensive loss, stockholders’ equity and cash flows for each of the two years in the period ended October 31, ~~2021~~2022, and the related notes (collectively referred to as the “financial statements”). In our opinion, the ~~consolidated~~ financial statements present fairly, in all material respects, the financial position of the Company as of October 31, ~~2021~~ 2022 and ~~2020,~~2021 and the results of its operations and its cash flows for each of the two years in the period ended October 31, ~~2021~~2022 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These ~~consolidated~~ financial statements are the ~~responsibility~~ responsibility of the entity’s management. Our responsibility is to express an opinion on these ~~consolidated~~ financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the ~~consolidated~~ financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ ZWICK ~~& BANYAI~~CPA, PLLC

Wef/k/a/ ~~have~~Zwick ~~served~~& asBanyai, ~~the Company’s auditor since 2010.~~PLLC

Southfield, Michigan

January 2019, ~~2022~~2023

We have served as the Company’s auditor since 2009.

F-2

IDW MEDIA HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Assets
Current assets:
Cash and cash equivalents	$	1710,~~532~~014		$	1017,~~541~~532
Trade accounts receivable, net		56,~~431~~448			225,~~921~~431
Inventory		34,~~090~~285			3,~~754~~090
Prepaid expenses		2,270			1,361
Prepaid expenses and other current assets		2,714			2,270
Current assets held for sale from discontinued operations		-			11,171
Total current assets		23,461			28,323
Total current assets		28,323			49,748
Non-current assets
Property and equipment, net		~~347~~725			~~410~~347
Right-of-use assets, net		~~302~~1,157			~~771~~302
Investments		-			25
Intangible assets, net		859			679
Intangible assets, net		679			52
Goodwill		199			199
Television costs, net		1,~~487~~486			21,~~926~~487
Other assets		6154			~~527~~61
Total assets	$	3127,~~398~~941		$	5431,~~658~~398
Liabilities and Stockholders’ Equity
Current liabilities:
Trade accounts payable	$	1,~~141~~321		$	1,~~406~~141
Accrued expenses		3,~~197~~353			23,~~458~~786
Production costs payable		~~2,010~~33			12,~~495~~010
Deferred revenue		~~2,045~~-			2,~~385~~045
Bank loans payable – current portion		-			14,204
Operating lease obligations – current portion		278			348
Government loans- current portion		-			793
Total current liabilities		4,985			9,330
Operating lease obligations – current portion		348			562
Other current liabilities		-			69
Current liabilities held for sale from discontinued operations		-			8,540
Total current liabilities		8,741			31,912
Non-current liabilities
Operating lease obligations – long term portion		20911			~~368~~20
Government loans – long term portion		-			403
Total liabilities	$	5,896		$	9,350
Related party loans payable – long term portion		-			3,750
Stockholders’ equity (see Note 3):
Total liabilities	$	8,761		$	36,433
Preferred stock, $.01 par value; authorized shares – 500; no shares issued at October 31, 2022 and October 31, 2021		-			-
Stockholders’ equity (see note 3):
Class B common stock, $0.01 par value; authorized shares – 20,000; 14,053 and 12,938 shares issued and 13,534 and 12,419 shares outstanding at October 31, 2022 and October 31, 2021, respectively		134			123
Preferred stock, $.01 par value; authorized shares – 500; no shares issued at October 31, 2021 and October 31, 2020		-			-
Class C common stock, $0.01 par value; authorized shares – 2,500; 545 shares issued and outstanding at October 31, 2022 and October 31, 2021		5			5
Class B common stock, $0.01 par value; authorized shares – 20,000; 12,938 and 9,987 shares issued and 12,419 and 9,468 shares outstanding at October 31, 2021 and October 31, 2020, respectively		123			93
Additional paid-in capital		104,553			103,819
Class C common stock, $0.01 par value; authorized shares – 2,500; 545 shares issued and outstanding at October 31, 2021 and October 31, 2020		5			5
Accumulated deficit		(81,451	)		(80,703	)
Additional paid-in capital		103,819			111,379
Treasury stock, at cost, consisting of 519 shares of Class B common stock at October 31, 2022 and October 31, 2021		(1,196	)		(1,196	)
Accumulated other comprehensive loss		-			(60	)
Total stockholders’ equity		22,045			22,048
Accumulated deficit		(80,114	)		(91,996	)
Total liabilities and stockholders’ equity	$	27,941		$	31,398
Treasury stock, at cost, consisting of 519 shares of Class B common stock at October 31, 2021 and October 31, 2020		(1,196	)		(1,196	)
Total stockholders’ equity		22,637			18,225
Total liabilities and stockholders’ equity	$	31,398		$	54,658

See accompanying notes to consolidated financial statements.

F-3

IDW MEDIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	Fiscal Years Ended
(in thousands, except per share data)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Revenues	$	3236,~~425~~094		$	3832,~~162~~425
Costs and expenses:
Direct cost of revenues		2116,~~783~~504			2921,~~530~~783
Selling, general and administrative		19,~~082~~933			1719,~~704~~082
Depreciation and amortization		~~245~~342			~~252~~245
Total costs and expenses		4136,~~110~~779			4741,~~486~~110
Loss from operations		(8,685	)		(98,~~324~~685	)
Interest income (expense), net		118			(46	)
Interest (expense) income, net		(10	)		118
Other income (expense), net		2,333			(318	)
Other (expense) income, net		(53	)		2,333
Net loss from continuing operations		(~~6,234~~748	)		(96,~~688~~234	)
Loss from discontinued operations, net		~~(1,281~~-	)		(41,~~110~~281	)
Gain on sale of discontinued operations		~~2,123~~-			-2,123
Net gain (loss) on discontinued operations		842			(4,110	)
Net gain on discontinued operations		-			842
Net loss	$	(~~5,392~~748	)	$	(135,~~798~~392	)
Basic and diluted income (loss) per share (note 2):
Basic and diluted net (loss) income per share (see Note 2):
Continuing operations	$	(0.5906	)	$	(10.0859	)
Discontinued operations, net		~~0.08~~-			(0.4608	)
Basic and diluted net loss per share	$	(0.51	)	$	(1.54	)
Net loss	$	(0.06	)	$	(0.51	)
Weighted-average number of shares used in the calculation of basic and diluted loss per share:		10,655			8,982
Weighted-average number of shares used in the calculation of basic and diluted (loss) income per share:		12,906			10,655

See accompanying notes to consolidated financial statements.

F-4

IDW MEDIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	Fiscal Years Ended
(in thousands)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Net loss	$	(~~5,392~~748	)	$	(135,~~798~~392	)
Foreign currency translation adjustments		39-			-39
Sale of discontinued operations		21-			-21
Total comprehensive loss	$	(~~5,332~~748	)	$	(135,~~798~~332	)

See accompanying notes to consolidated financial statements

F-5

IDW MEDIA HOLDINGS, INC.

~~Consolidated~~CONSOLIDATED ~~Stockholders~~STOCKHOLDERS’ ~~Equity~~ EQUITY

Fiscal Years Ended October 31, ~~2021~~2022 and ~~2020~~2021

(in thousands)

	Class B Common Stock				Class C Common Stock				Additional			Accumulated Other						Treasury Stock, at Cost					Total
(in thousands)	Number of Shares		Amount		Number of Shares		Amount		Paid In Capital			Comprehensive Loss			Accumulated Deficit			Number of Shares		Amount			Stockholders’ Equity
Balance October 31, 2021		12,938	$	123		545	$	5	$	103,819		$	-		$	(80,703	)		519	$	(1,196	)	$	22,048
Stock based compensation		-		-		-		-		745			-			-			-		-			745
Issuance of restricted stock		1,115		11		-		-		(11	)		-			-			-		-			-
Comprehensive loss
Net loss		-		-		-		-		-			-			(748	)		-		-			(748	)
Total comprehensive loss		-		-		-		-		-			-			(748	)		-		-			(748	)
Balance October 31, 2022		14,053	$	134		545	$	5	$	104,553		$	-		$	(81,451	)		519	$	(1,196	)	$	22,045

Balance October 31, 2020		9,987	$	93		545	$	5	$	111,379		$	(60	)	$	(92,585	)		519	$	(1,196	)	$	17,636
Stock based compensation		-		-		-		-		329			-			-			-		-			329
Issuance of common stock		2,881		29		-		-		9,407			-			-			-		-			9,436
Issuance of restricted stock		70		1		-		-		(1	)		-			-			-		-			-
Comprehensive income (loss)
Sale of discontinued operations		-		-		-		-		(17,295	)		21			17,274			-		-			-
Net loss		-		-		-		-		-			-			(5,392	)		-		-			(5,392	)
Other comprehensive income		-		-		-		-		-			39			-			-		-			39
Total comprehensive income (loss)		-		-		-		-		-			60			(5,392	)		-		-			(5,332	)
Balance October 31, 2021		12,938	$	123		545	$	5	$	103,819		$	-		$	(80,703	)		519	$	(1,196	)	$	22,048

	Class B Common Stock		Class C Common Stock												Treasury Stock, at Cost
	Number of Shares	Amount	Number of Shares	Amount	Stock Subscriptions Receivable		Additional Paid In Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Non- Controlling Interest (“NCI”)		Number of Shares	Amount		Total Stockholders’ Equity
Balance October 31, 2020	9,987	93	545	5	-		111,379		(60	)	(91,996	)	-		519	(1,196	)	18,225
Stock based compensation	-	-	-	-	-		329		-		-		-		-	-		329
Issuance of common stock	2,951	30	-	-	-		9,406		-		-		-		-	-		9,436
Comprehensive loss
Sale of discontinued operations	-	-	-	-	-		(17,295	)	21		17,274		-		-	-		-
Net loss	-	-	-	-	-		-		-		(5,392	)	-		-	-		(5,392	)
Other comprehensive income	-	-	-	-	-		-		39		-		-		-	-		39
Total comprehensive loss	-	-	-	-	-		-		60		(5,392	)	-		-	-		(5,332	)
Balance October 31, 2021	12,938	123	545	5	-		103,819		-		(80,114	)	-		519	(1,196	)	22,637
Balance October 31, 2019	7,419	74	545	5	(1,000	)	96,671		(60	)	(78,457	)	35		519	(1,196	)	16,072
Stock based compensation	-	-	-	-	-		1,131		-		-		-		-	-		1,131
Issuance of common stock	2,568	19	-	-	-		13,566		-		-		-		-	-		13,585
Subscriptions receivable	-	-	-	-	1,000		11		-		-		-		-	-		1,011
NCI divestment in subsidiary	-	-	-	-	-		-		-		259		(35	)	-	-		224
Comprehensive loss
Net loss	-	-	-	-	-		-		-		(13,798	)	-		-	-		(13,798	)
Other comprehensive income	-	-	-	-	-		-		-		-		-		-	-		-
Total comprehensive loss	-	-	-	-	-		-		-		(13,798	)	-		-	-		(13,798	)
Balance October 31, 2020	9,987	93	545	5	-		111,379		(60	)	(91,996	)	-		519	(1,196	)	18,225

See accompanying notes to consolidated financial statements.

F-6

IDW MEDIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Fiscal Years Ended
(in thousands)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Operating activities:
Net loss	$	(~~5,392~~748	)	$	(135,~~798~~392	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		433			1,017
Amortization of television costs		1,348			5,414
Amortization of finance leases		108			411
Impairment of television costs		277			2,216
Bad debt expense		(79	)		680
Depreciation and amortization		342			433
Stock based compensation		329			1,131
Amortization of finance leases		-			108
Amortization of right-of-use asset		475			1,557
Bad debt recovery		-			(79	)
Gain on extinguishment of PPP Loans		(2,460	)		-
Stock based compensation		745			329
Gain on sale of discontinued operations		(2,123	)		-
Amortization of right-of-use asset		396			475
Loss on deconsolidation of subsidiary		-			35
Gain on extinguishment of PPP Loans		-			(2,460	)
Gain on sale of discontinued operations		-			(2,123	)
Changes in operating assets and liabilities:
Trade accounts receivable		17(1,~~460~~017	)		2017,~~807~~460
Inventory		~~664~~(1,195	)		~~(442~~664	)
Prepaid expenses and other assets		(~~414~~437	)		~~735~~(414	)
Television costs		(1,~~439~~624	)		(6,~~462~~191	)
Operating lease liability		(~~287~~430	)		(~~1,597~~287	)
Trade accounts payable, accrued expenses, production costs payable and other current liabilities		~~921~~(2,230	)		~~(2,108~~921	)
Deferred revenue		(~~340~~2,045	)		~~795~~(340	)
Gain on disposal of ROU assets		~~(97~~-	)		-(97	)
Deconsolidation of subsidiary		-			304
Net cash (used in) provided by operating activities		(6,618	)		10,637
Net cash provided by operating activities		10,637			15,989
Investing activities:
Proceeds on disposition of long lived assets		-			185
Disposal of discontinued operations		-			(902	)
Disposition of subsidiary, net of cash received		-			(115	)
Capital expenditures		(900	)		(832	)
Disposal of discontinued operations		(902	)		-
Net cash used in investing activities		(900	)		(1,734	)
Capital expenditures		(832	)		(420	)
Net cash used in investing activities		(1,734	)		(350	)
Financing activities:
Proceeds from issuance of common stock		~~9,436~~-			149,~~596~~436
Repayments of finance lease obligations		-			(404	)
Proceeds of government loans		-			1,196
Proceeds of government loans		1,196			3,004
Repayments of bank loans		-			(14,204	)
Proceeds of bank loans		-			1,021
Net cash used in financing activities		-			(3,572	)
Repayments of related party loans		-			(5,300	)
Effect of exchange rate changes on cash and cash equivalents		-			39
Repayments of bank loans		(14,204	)		(26,559	)
Net (decrease) increase in cash and cash equivalents		(7,518	)		5,370
Net cash used in financing activities		(3,572	)		(13,642	)
Cash and cash equivalents at beginning of period		17,532			12,162
Effect of exchange rate changes on cash and cash equivalents		39			-
Cash and cash equivalents at end of period	$	10,014		$	17,532
Net increase in cash and cash equivalents		5,370			1,997
Cash and cash equivalents at beginning of period		12,162			10,165
Cash and cash equivalents at end of period	$	17,532		$	12,162
Supplemental schedule of investing and financing activities
Cash paid for interest	$	~~1,277~~-		$	~~200~~1,277
Cash paid for income taxes		-			98
Received from sale of long lived assets		-			154
Non-cash investing and financing activities
Extinguishment of related party loan in exchange for sale of CTM	$	~~3,750~~-		$	-3,750

See accompanying notes to consolidated financial statements.

F-7

IDW ~~MEDIA~~ HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, ~~2021~~ 2022 AND ~~2020~~2021

Note 1—Basis of Presentation and Summary of Significant Accounting Policies

Overview

IDW Media Holdings, Inc., a Delaware corporation, (“IDWMH”) together with its subsidiaries (collectively, the “Company”) is a diversified media company with operations in publishing and television entertainment. The terms “Company,” “we,” “us,” and “our” are used in this report to refer collectively to ~~the~~IDWMH ~~parent company~~ and ~~the~~its subsidiaries through which various businesses are conducted.

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared by management in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. All amounts in these consolidated financial statements and notes to the consolidated financial statements are reflected on a consolidated basis for all periods presented.

The Company’s fiscal year ends on October 31st. Each reference below to a fiscal year refers to the fiscal year ending in the calendar year indicated (e.g., fiscal ~~2021~~ 2022 refers to the fiscal year ended October 31, ~~2021~~2022).

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. The Company has considered information available to it as of the date of issuance of these consolidated financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgements, or an adjustment to the carrying value of its assets or liabilities. The accounting estimates and other matters assessed include, but were not limited to, goodwill and other long-lived assets, and revenue recognition. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates.

InRisks March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The Company is actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential impact on each of our operating segments. While we believe that in 2021, there has been significant improvement due to global and domestic vaccination efforts, there is uncertainty around the duration and ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and our operations and our customers and partners may continue to be impacted. The Company has considered information available to it as of the date of issuance of these consolidated financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgements, or an adjustment to the carrying value of its assets or liabilities. The accounting estimates and other matters assessed include, but were not limited to, goodwill and other long-lived assets, and revenue recognition. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates.Uncertainties

~~Segment~~In ~~Information~~March 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) as a pandemic, which continues to spread throughout the World. The Company is actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential impact on each of its operating segments. While the Company believes that in fiscal 2022, there has been significant improvement in the impact of the pandemic and the related measures, there is uncertainty around the duration and ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and the Company’s operations and its customers and partners may continue to be impacted.

~~Financial~~In ~~Accounting~~February ~~Standards~~2022, ~~Board~~the ~~(“FASB”) Accounting~~Russian ~~Standards~~Federation ~~Codification~~and ~~280~~Belarus ~~(“ASC~~commenced ~~280”)~~a military action with the country of Ukraine. As a result of this action, ~~Segment~~various ~~Reporting~~nations, ~~establishes~~including ~~standards~~the ~~for~~United ~~reporting~~States ~~information~~of ~~about operating~~America, ~~segments.~~have ~~Operating~~instituted ~~segments~~economic ~~are~~sanctions ~~defined~~against asthe ~~components~~Russian Federation and Belarus. Further, the impact of anthis ~~enterprise~~action ~~about~~and ~~which~~related ~~separate~~sanctions ~~financial~~on ~~information~~the isworld ~~available that~~economy isare ~~evaluated~~not ~~regularly~~determinable byas of the ~~chief~~date ~~operating~~of ~~decision~~these ~~maker~~financial statements and the specific impact on the Company’s financial condition, orresults ~~decision-making~~of ~~group~~operations, inand ~~deciding~~cash ~~how~~flows related to ~~allocate~~IDWP’s foreign ~~resources~~licenses ~~and in~~is ~~assessing~~also ~~performance~~not determinable as of the date of these financial statements.

The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial performance and the results of operations of the segments prepared in accordance with U.S. GAAP when making decisions about allocating resources and assessing performance of the Company.

F-8

~~IDW~~Segment ~~MEDIA HOLDINGS, INC.~~Information

~~NOTES~~Financial TOAccounting ~~CONSOLIDATED~~Standards ~~FINANCIAL~~Board ~~STATEMENTS~~(“FASB”) Accounting Standards Codification (“ASC”) 280, Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance.

~~FOR~~The ~~THE~~Company’s ~~FISCAL~~chief ~~YEARS~~operating ~~ENDED~~decision ~~OCTOBER~~maker is 31the Chief Executive Officer, ~~2021~~who reviews the financial performance and the results of operations of the segments prepared in accordance ~~AND~~with ~~2020~~U.S. GAAP when making decisions about allocating resources and assessing performance of the Company (see Note 5).

InThe ~~Fiscal~~Company’s ~~2021, our~~ principal ~~businesses consisted~~business consists of the following segments:

i. IDWP Publishing (“IDWP”), a publishing company that creates comic books, graphic novels, and digital content ~~and games~~ through its imprints IDW, ~~IDW Games,~~ Top Shelf Productions, and Artist’s Editions; and ~~The~~ii. ~~Library~~IDW Entertainment (“IDWE”) a production company and studio that develops, produces, and distributes content based on IDWP’s original copyrighted intellectual property (“IP”), published in the form of ~~American~~comic ~~Comics;~~books, graphic novels and any other forms of print publication, for a variety of formats including film and television.

~~ii.~~Prior ~~IDW~~to ~~Entertainment~~February 15, 2021, the Company also owned CTM Media Group (“~~IDWE~~CTM”), a ~~production~~ company ~~and studio~~ that develops, ~~produces~~ and distributes ~~content~~print and digital-based onadvertising ~~IDWP’s~~and ~~original~~information IPadvertising for atourist destinations ~~variety~~in oftargeted ~~formats~~tourist ~~including~~markets ~~film~~in 32 states / provinces in the US and ~~television~~Canada. ~~Most~~On ~~recently~~February 15, in2021 ~~partnership~~(“CTM ~~with~~Sale ~~Netflix~~Date”), the ~~IDWE~~Company ~~launched~~consummated the ~~second~~sale ~~season~~ of ~~Locke~~CTM &to ~~Key,~~an ~~with~~assignee aof ~~third~~Howard ~~season~~Jonas, ~~already~~the ~~planned~~Company’s Chairman in exchange for ~~Fall/Winter~~(i) ~~2022~~the cancelation of $3.75 Inmillion ~~addition~~of indebtedness the Company owed to the Company’s Chairman’s designee, (ii) a ~~new~~contingent ~~live~~payment ~~action~~of ~~series~~up to $3.25 million based onupon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the ~~graphic~~18-month ~~novel~~period ~~Surfside~~following the ~~Girls~~sale (which condition was not met), and (iii) a contingent payment if CTM is sold within 36 months of the sale for more than $4.5 million (“CTM Sale”). As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in ~~production~~the consolidated financial statements as discontinued operations (See Note 16). As of October 31, 2022, the 18-month period for the contingent payment based upon recovery of quarterly revenue has lapsed and no payment is owed.

During calendar 2021, we began to wind down operations at IDW Games and, going forward, IDW Games is only backfilling final orders

Prior to February 15, 2021, we also owned CTM Media Group (CTM), a company that develops and distributes print and digital-based advertising and information advertising for tourist destinations in targeted tourist markets in 32 states / provinces in the US and Canada. On February 15, 2021, we consummated the sale of CTM to an assignee of Howard Jonas, the Company’s Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness we owed to our Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the sale, and (iii) a contingent payment if CTM is sold within 36 months of the sale for more than $4.5 million. As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the financial statements as discontinued operations (Note 17 Discontinued Operations).

Cash and Cash Equivalents

The Company considers all highly liquid investments or debt instruments with an original maturity of three months or less when purchased to be cash equivalents.

Trade Accounts Receivable, Net

Trade accounts receivables are recorded at the invoiced amount and are generally unsecured as they are uncollateralized. The Company provides an allowance for doubtful accounts to ~~reduce~~ reduce receivables to their estimated net realizable value. Judgement is exercised in establishing allowances and estimates are based on the ~~tenants~~ customers’ payment history and liquidity. Any amounts that were previously recognized as revenue and subsequently determined to to be uncollectible are charged to bad debt expense included in selling, general and administrative expense in the accompanying consolidated statements of operations. The Company had an allowance for doubtful accounts of $0 as of October 31, 2022 and 2021.

The balances of and changes in the allowance for doubtful accounts are as follows:

	October 31, 2021			October 31, 2020
Beginning Balance	$	29		$	29
Additions		—			—
Write-offs		(29	)		—
Ending Balance	$	—		$	29

F-9

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Inventory

Inventory consists of IDWP’s graphic novels and comic books ~~(print)~~. Inventory is stated at the lower of cost or net realizable value determined by the first in, first out method ~~for print~~.

F-9

Property and Equipment

Property and equipment are recorded at cost less accumulated depreciation. The Company charges the cost of repairs and maintenance, including the cost of replacing minor items not constituting substantial betterment, to selling, general and administrative expenses as these costs are incurred. Depreciation is recognized over the estimated useful lives or lease terms as follows:

Asset Category		Depreciable Life
Equipment		5-7 years
Furniture & fixtures		5-7 years
Computer software		1-3 years
Leasehold improvements		*

Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life of the asset.

Long-Lived Assets, Including Definite-Lived Intangible Assets

Intangible assets, which consist of licensing contracts and capitalized software, are recorded at cost, and are amortized on a straight-line basis over their contractual or estimated useful lives, whichever is shorter from 5 -– 7 years.

In accordance with ‘ASC 360’, - Accounting ~~for~~ for the Impairment or Disposal of Long-Lived Assets-, the Company tests the recoverability of its long-lived assets with finite useful lives whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The Company tests for impairment based on the projected undiscounted cash flows to be derived from such asset. If the projected undiscounted future cash flows are less than the carrying value of the asset, the Company will record an impairment loss based on the difference between the estimated fair value and the carrying value of the asset. The Company generally measures fair value by considering sale prices for similar assets or by discounting estimated future cash flows from such asset using an appropriate discount rate. Cash flow projections and fair value estimates require significant estimates and assumptions by management. Should the estimates and assumptions prove to be incorrect, the Company may be required to record impairments in future periods and such impairments could be material.

Goodwill

Goodwill, which represents the excess of purchase prices over the fair value of nets assets acquired, is carried at cost. Goodwill is not amortized; rather, it is subject to a periodic assessment for impairment by applying a fair value-based test. Goodwill is evaluated for impairment on an annual basis at a level of reporting referred to as the reporting unit, and more frequently if adverse events or changes in circumstances indicate that the asset may be impaired.

Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not (that is, a likelihood of more than 50%) that the fair value of the reporting unit is less than its carrying amount. The qualitative assessment considers macroeconomic conditions, industry and market considerations, cost factors and overall company financial performance. If the reporting unit does not pass the qualitative assessment, the carrying amount of the reporting unit, including goodwill, is compared to its fair value. When the carrying amount of the reporting unit exceeds its fair value, a goodwill impairment loss is recognized up to a maximum amount of the recorded goodwill related to the reporting unit. Goodwill impairment losses are not reversed. There was no impairment loss of goodwill for the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~2021.

F-10

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Television Costs

WeThe ~~expense~~Company capitalizes television production, participation and residual costs and amortizes them over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total revenues (“Ultimate Revenues”) for each production. If ~~our~~the ~~estimate~~Company’s estimate of Ultimate Revenues decreases, amortization of film and television costs may be accelerated. Conversely, if ~~our~~the ~~estimate~~Company’s estimate of Ultimate Revenues increases, film and television cost amortization may be slowed. For television series, Ultimate Revenues include revenues that are expected to be earned within ten years from delivery of the first episode, or if still in production, five years from delivery of the most recent episode~~, if later~~. ~~IDWE~~ capitalized cost of production and amortized it over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total revenues (Ultimate Revenues) for each production. Advertising, marketing, general and administrative costs are expensed as incurred.

Every quarter, the Company prepares analyses to support its content amortization expense. Critical assumptions used in determining content amortization include: (i) determining the grouping of contents (ii) the application of an ultimate revenue forecast model based on the contracts of televisions, (iii) gathering the schedules of delivered television episodes from the relative customers, (iv) calculating current period amortization, (v) assessing the accuracy of the Company’s forecasts. The Company continually reviews its estimates and contracts and revises its assumptions if necessary. Any material adjustments from the Company’s review of the amortization are applied prospectively in the period of the change for assets.F-10

~~With~~Every ~~respect~~quarter, tothe ~~television~~Company ~~series~~undertakes oran ~~other television productions~~analysis ~~intended~~to ~~for~~support ~~broadcast,~~its ~~the~~content ~~most~~amortization ~~sensitive~~expense. ~~factors~~Critical ~~affecting~~assumptions ~~estimates~~used ofin ~~Ultimate~~determining ~~Revenues~~content ~~are~~amortization ~~program~~include: ~~ratings~~(i) ~~and~~determining the grouping ~~strength~~ of ~~the advertising~~contents ~~market.~~(ii) ~~Program~~the ~~ratings,~~application ~~which~~of ~~are~~ an ~~indication~~ultimate ofrevenue ~~market~~forecast ~~acceptance,~~model ~~directly~~based ~~affect~~on the ~~Company’s~~contracts ~~ability~~of totelevisions, ~~generate advertising~~(iii) ~~revenues during~~ gathering the ~~airing~~schedules of ~~the~~delivered ~~program.~~television ~~Television~~episodes ~~development~~from ~~costs~~the ~~for~~relative ~~projects~~customers, ~~that~~(iv) ~~have~~calculating ~~been~~current ~~abandoned~~period oramortization, ~~have~~(v) ~~not~~assessing ~~been~~the ~~set~~accuracy ~~for~~of ~~production within three years are generally written off in~~ the ~~relevant~~Company’s ~~period~~forecasts.

The Company continually reviews its estimates and contracts and revises its assumptions if necessary. Any material adjustments from the Company’s review of the amortization are applied prospectively in the period of the change for assets.

With respect to television series or other television productions intended for broadcast, the most sensitive factors affecting estimates of Ultimate Revenues are program ratings and the strength of the advertising market. Television development costs for projects that have been abandoned or have not been set for production within three years are generally written off in the relevant period.

Television costs are stated at the lower of cost less accumulated amortization or fair value. The Company evaluates impairment by the fair value of television costs at the individual level by considering expected future revenue generation, when an event or change in circumstances indicates a change in the expected revenue of the television costs or that the fair value of a film or film group may be less than unamortized costs.

IDWE regularly enters into agreements for the production of its television shows. The agreements provide for the rights and obligations related to the agreement including timing, delivery , and payments. IDWE capitalizes the resulting production costs under the agreements in production cost inventory as payments are made or when the products or services are delivered. Amortization of television costs during the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~ 2021 were $51,~~414~~348,000 and $165,~~808~~414,000, respectively.

F-11

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Variable Interest Entities

The Company, through its subsidiary IDWE has arrangements with ~~seven~~ seven special-purpose entities (“SPEs”),. ~~some~~Some SPEs were formed for the sole purpose of providing production services ~~in Canada for the production~~ of a television pilot and ~~television~~ series in Canada, ~~others~~and other SPEs were formed for production and writing purposes. The SPEs are independently owned companies that are effectively controlled by IDWE, ~~that~~and are parties to the related bank production financing arrangements. The Company has determined that SPEs are variable interest entities (“VIEs”) and that the Company is the primary beneficiary of the SPEs activities and was the obligor on the SPEs’ debt. All financial activity of the SPEs ~~have~~has been included in IDWE’s financial statements, which are part of these consolidated financial statements. IDWE ~~does~~is not ~~need~~obligated to provide any support to the VIE’s and therefore, there are no ~~foreseen~~additional ~~potential~~ losses ~~associated~~foreseen. ~~They~~The SPEs have finished all of the productions and these shows have been delivered. The outstanding loans have been paid off. The carrying amounts and classification of the VIEs’ assets ~~and liabilities~~ are presented below:

(in thousands)	October 31, ~~2021~~2022		October 31, ~~2020~~2021
Cash and cash equivalents	$	78126	$	~~732~~78
Accounts receivable		-		12,420
Bank loans payable		-		14,204

Revenue Recognition

The Company applies the five-step approach as described in ASC 606, Revenue from Contracts with Customers, which consists of the following: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when (or as) the entity satisfies a performance obligation.

IDWP generates revenue primarily from the sale and licensing of comic books, graphic novels, digital content, and games through IDWP’s imprints IDW ~~Publishing~~, ~~IDW~~Top ~~Games~~Shelf, and ~~Top~~ ~~Shelf~~Artist’s Editions. Revenue from the ~~direct~~ sale of comic books, graphic novels and games is recognized, net of an allowance for estimated sales returns, at the time of shipment of its comic books, graphic novels, ~~comic books~~ and games by IDWP’s ~~distributor~~distributors to its customers. Licensing revenues are recognized upon execution of the agreement for such rights, and other creative revenues are recognized upon completion of services rendered on a contractual basis.

IDWE generates revenue primarily from the licensing and distribution of content across various platforms and formats to audiences globally including television series and films. IDWE’s revenue is recognized when evidence of a sale or licensing arrangement exists, the product is complete, has been delivered or is available for immediate and unconditional delivery, the license period has begun, the fee is fixed or determinable, and collection is reasonably assured.F-11

IDWE ~~enters~~generates ~~into~~revenue ~~production~~primarily ~~agreements~~from ~~which provide for~~ the ~~rights~~licensing and ~~obligations~~distribution ~~related~~of content across various platforms and formats to ~~the~~audiences ~~agreement~~globally including ~~timing,~~television ~~delivery~~series and ~~payments~~films. InIDWE’s revenue ~~certain~~is ~~productions,~~recognized ~~IDWE~~when ~~chooses~~the tocontent ~~have~~promised in an executed contract is transferred to the ~~obligation~~customer in an amount that reflects the consideration to ~~pay~~which the ~~Writers~~Company ~~Guild~~expects ofto ~~America~~be ~~(“WGA”)~~entitled ~~residuals~~in exchange for the ~~creative~~content. ~~writers~~Beginning in the third fiscal quarter of 2022, revenue was also generated from serving as a co-studio and executive producer of content. ~~These~~across ~~extend~~various toplatforms 25and ~~years~~formats ~~after~~to audiences ~~distribution~~globally including television series and ~~are~~films. ~~recorded~~This revenue is recognized when the services promised in the ~~consolidated~~contract ~~statements~~are oftransferred to ~~operations~~the ascustomer ain ~~direct~~an ~~cost~~amount ofthat ~~revenue.~~reflects Inthe ~~addition,~~consideration ~~IDWE~~to ~~has~~which the ~~right~~ Company expects to ~~receive~~be ~~participation~~entitled ~~rights~~in ~~recoupment~~exchange ~~based~~for onthe ~~viewership~~services. IDWE also earns revenue from the sale of the ~~cumulative~~option ~~production.~~to ~~The~~purchase ~~Company~~the ismedia ~~unable~~rights for IDWP properties to ~~make~~studios anand ~~estimate~~streamers. This revenue asis recognized when the ~~recoupment~~goods ispromised ~~based~~in onthe ~~future~~contract ~~viewership~~are ~~and~~transferred ~~therefore~~to ~~revenue~~the ~~will~~customer bein ~~recognized~~an atamount athat ~~future~~reflects ~~date~~the ~~once~~consideration to which the ~~amount~~Company isexpects ~~known~~to be entitled in exchange for the goods.

IDWE’s enters into production ~~activities~~agreements ~~included~~which ~~some~~provide for the rights ofand ~~those~~obligations ~~provided~~related byto ~~Canadian~~the ~~SPEs~~agreement including timing, delivery, and ~~some~~payments. ofIn ~~those~~certain productions ~~qualify~~in ~~for~~which ~~tax~~IDWE ~~credits~~is inthe ~~Canada.~~distributor, IDWE ~~These~~has ~~credits~~the ~~are~~obligation ~~recorded~~to aspay ~~reductions in~~artist, ~~production~~director, ~~cost~~and ~~when~~writer ~~the~~guilds ~~SPEs~~for ~~becomes~~residuals ~~entitled~~for to the ~~Canadian~~creative ~~tax~~writers ~~credits~~of content. ~~The~~In ~~Canada~~addition, ~~Revenue Agency (“CRA”)~~ IDWE has ~~completed~~ the ~~audit~~right onto ~~these~~receive ~~productions~~participation ~~and~~rights ~~the~~recoupment ~~related~~based ~~tax~~on ~~refunds~~viewership ~~are~~of nothe ~~longer~~cumulative ~~estimates~~production. ~~There~~The ~~are~~Company ~~possible~~is ~~additional~~unable ~~tax~~to ~~credits~~make an estimate as the ~~Company may~~recoupment beis ~~eligible~~based toon ~~receive,~~future ~~however~~viewership ~~due~~and totherefore ~~the~~revenue ~~uncertainty~~will ofbe ~~the~~recognized ~~receipt~~at ~~they~~a ~~have~~future ~~not~~date ~~been~~once ~~accrued~~the ~~for~~amount is known.

IDWE’s production activities included some of those provided by Canadian SPEs, and some of those productions qualified for tax credits in Canada. These credits were recorded as either revenue or reductions in production cost when the SPEs becomes entitled to the Canadian tax credits. The Canada Revenue Agency (“CRA”) has completed the audit on these productions and the related tax refunds are no longer estimates. As of October 31, 2022, the consolidated statements of operations reflect final tax refund amounts.

The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the satisfaction of performance obligations, the Company records a contract liability on the balance sheets within deferred revenue until the performance obligations are satisfied.

In the ordinary course of business, the Company’s reportable segments enter into transactions with one another. The most common types of intersegment transactions include IDWE obtaining rights to produce television series based on content created by IDWP. ~~While~~All intersegment transactions are ~~treated like third-party transactions to determine segment performance, the revenues are~~ eliminated in consolidation and, therefore, do not affect consolidated results.

F-12

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Revenue Recognition When Right of Return Exists

IDWP’s ~~offers its~~ book market distributors, aoffer ~~right~~a right of return to retail customers with no expiration date in accordance with general industry practices. ~~These~~IDWP ~~distributors~~generally ~~then~~does not offer the ~~this same~~ right of return to ~~their~~on ~~book~~the ~~market~~sale ~~retail~~of ~~customers~~comic books. Sales returns allowances represent a reserve for IDWP products that may be returned due to dating, competition or other marketing matters, or certain destruction in the field. Sales returns are generally estimated and recorded ~~based~~ based on historical sales and returns experience and current trends that are expected to continue. ~~Licensing revenues are recognized upon execution of the agreement for such rights, and other creative revenues are recognized upon completion of services rendered on a contractual basis.~~ As of October 31, ~~2021~~2022 and ~~2020~~2021, the Company’s ~~accrual for~~ estimated ~~lases~~ returns were $~~127~~110,000 and $~~296~~127,000, respectively.

Direct Cost of Revenues

Direct cost of revenues excludes depreciation and amortization expense. Direct cost of revenues for IDWP consists primarily of printing expenses and costs of ~~artist~~artists and writers. Direct cost of revenues for IDWE consists primarily of the amortization of production costs that were capitalized during the production of the television episodes, residuals, accrued third party participation, and distribution fees directly related to revenue.

F-12

Deferred Revenue

The Company records deferred revenue upon invoicing for contracted commitments for products and services. Revenue is recognized on the date such product or service is provided or delivered in accordance with the contract.

Advertising Expense

~~Non-direct~~Advertising ~~response~~costs ~~advertising~~are is expensed as incurred, including digital and print advertisements. In fiscal ~~2021~~2022 and fiscal ~~2020~~2021, advertising expenses were approximately $~~329~~363,000 and $~~274~~329,000, respectively.

Stock-Based Compensation

The Company accounts for stock-based compensation granted to its employees in accordance with the fair value recognition provisions of ASC 718, Stock Compensation. Stock-based compensation expense is measured at the date of grant, based on the fair value of the award, and is recognized using the straight-line method over the employee’s vesting period or requisite service period. Compensation for stock-based awards with vesting conditions other than service are recognized at the time that those conditions ~~will~~are be achieved. Forfeitures are recognized as they are incurred. Stock-based ~~compensation~~ compensation is included in selling, general and administrative expense.

Leases

Effective November 1, 2019, the Company adopted Accounting Standard Update (“ASU”) No. 2016-02, Leases (Topic 842) utilizing the modified retrospective adjustment transition method through a cumulative-effect adjustment at the beginning of the first fiscal quarter of 2020.

The company determines if an arrangement is a lease at inception. Under the new standard, operating leases are included in right-of-use (“ROU”) assets, operating leases obligations – current portion, and operating lease obligations – long term portion in the consolidated balance sheets. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Fixed lease expense for lease payments is recognized in the consolidated statements of operations on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred.

FROU assets represent the Company’s right to use an underlying asset over the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, the Company estimated its incremental borrowing rate to discount the lease payments based on information available at lease commencement. The Company uses the implicit rate when readily determinable. The Company’s incremental borrowing rate is the rate of interest we would have to pay to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The operating ROU assets also includes any lease payments made before the lease commencement date less any lease incentives received. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise the options. The lease agreements with lease and non-13lease components are generally accounted as a single component.

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

ROU assets represent the Company’s right to use an underlying asset over the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, the Company estimated its incremental borrowing rate to discount the lease payments based on information available at lease commencement. The Company uses the implicit rate when readily determinable. Our incremental borrowing rate is the rate of interest we would have to pay to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The operating ROU assets also includes any lease payments made before the lease commencement date less any lease incentives received. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise the options. The lease agreements with lease and non-lease components are generally accounted as a single component.

Distinguishing Liabilities from Equity

The Company accounts for freestanding financial instruments, including warrants issued in consideration of debt instruments, as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in FASB’s ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For warrants that meet all criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance based on their relative fair value. For issued or modified warrants that do not meet all criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance and each balance sheet date thereafter, with changes in fair value recorded in earnings. All warrants currently outstanding are equity-classified instruments.

F-13

Concentration Risks

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, ~~short term investment~~ and trade accounts receivable. The Company holds cash and cash equivalents at ~~several~~ major financial institutions, which often exceed ~~FDIC~~Federal Deposit Insurance Corporation’s (“FDIC”) insurance limits. Historically, the Company has not experienced any losses due to such concentration of credit risk. The Company’s temporary cash investments policy is to limit the dollar amount of investments with any one financial institution and monitor the credit ratings of those institutions. While the Company may be exposed to credit losses due to the nonperformance of its counterparties, the Company does not expect the settlement of these transactions to have a material effect on its results of operations, cash flows or financial condition.

During fiscal years 2022 and 2021, IDWP ~~has~~had two significant customers, Penguin Random House ~~Publisher Services~~ (“~~PRHPS~~PRH”) and Diamond Comic Distributors, Inc. (“Diamond”), that ~~pose~~ posed a concentration risk. From June 1, 2022, only PRH

~~Revenues~~poses ~~from~~a ~~PRHPS,~~concentration ~~IDWP’s non-direct market distributor amounted to 32~~risk.8% and 30.8% of consolidated revenue in the fiscal years ended October 31, 2021 and 2020, respectively. The receivable balances represented 52.0% and 15.8% of consolidated receivables at October 31, 2021 and 2020, respectively. Beginning June 1, 2022, PRHPS will replace Diamond as IDWP’s distributor to the direct market.

Revenues from ~~Diamond~~PRH, IDWP’s non-direct market distributor and beginning June 1, 2022, IDWP’s direct market distributor, represented 31 37.2% and 1832.58% of ~~the total~~ consolidated ~~revenues~~revenue ~~for~~ in the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~2021, respectively. The receivable balances ~~from this customer~~ represented ~~approximately 20~~63.09% and 452.70% of consolidated ~~trade accounts receivable~~ receivables at October 31, ~~2021~~2022 and ~~2020~~ 2021, respectively.

~~F-14~~Revenues from Diamond, which was IDWP’s direct market distributor until June 1, 2022, represented 13.6% and 32.2% of the total consolidated revenues for the fiscal years ended October 31, 2022 and 2021, respectively. The receivable balances from Diamond represented 0% and 20% of consolidated receivables at October 31, 2022 and 2021, respectively.

~~IDW~~IDWE ~~MEDIA~~has ~~HOLDINGS~~two significant customers, ~~INC~~Netflix and Fifth Season (formerly Endeavor Content LLC), that pose a concentration risk.

~~NOTES~~Revenue TOfrom ~~CONSOLIDATED~~Netflix, ~~FINANCIAL~~a ~~STATEMENTS~~leading streaming video subscription service, represented 25.0% and 0.5% of the total consolidated revenue in the fiscal years ended October 31, 2022 and 2021, respectively.

~~FOR~~The ~~THE~~receivable ~~FISCAL~~balances ~~YEARS~~from ~~ENDED~~Fifth ~~OCTOBER~~Season represented 17.7% and 0% of consolidated receivables at October 31, ~~2021~~2022 ~~AND~~and ~~2020~~2021, respectively.

IDWE has one significant customer, Netflix, that poses a concentration risk.

Revenue from Netflix, a leading streaming video subscription service, represented 0.5% and 21.1% of the total consolidated revenue in the fiscal years ended October 31, 2021 and 2020, respectively. The receivable balances from this customer represented 4.0% and 15.3% of consolidated trade receivables at October 31, 2021 and 2020, respectively.

Discontinued Operations

CTM ~~has~~ met the criteria for discontinued operations and has been presented as such in the consolidated financial statements. In accordance with Accounting Standard Update (“ASU”) No. 2014-08, “Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity,” a disposal is categorized as a discontinued operation if the disposal group is a component of an entity or group of components that meets the held for sale criteria, is disposed of by sale, or is disposed of other than by sale, and represents a strategic shift that has or will have a major effect on an entity’s operations and financial results.

During the period in which the discontinued operation was classified as held for sale, the net loss was reclassified as a separate line item in the ~~Statement~~consolidated statement of ~~Operations~~operations. Additionally, the gain from the sale was presented as a separate line item on the ~~Statement~~consolidated statement of ~~Operations~~operations. Assets and liabilities ~~are~~ were also separately reclassified in the consolidated balance sheet for all periods presented, prior to the sale. CTM’s assets. liabilities, and cash flows are no longer reflected on the consolidated financial statements for the periods following the CTM Sale Date. Cash flows from a discontinued operation and the continuing business are presented together without separate identification within cash flows from operating, investing, and financing activities. ~~Cash flows of~~ CTM’s depreciation, amortization, capital expenditures and significant noncash operating and investing activities for the discontinued operation are presented separately.

~~Reclassification of prior year presentation~~F-14

~~Certain~~Revision prior year amounts have been reclassified for consistency with the current year presentation, these reclassifications have not resulted in impacts to net loss. Stock options have been included with stock based compensation on the Consolidated Stockholders’ Equity and Consolidated Statement of ~~Cash~~previously ~~Flows.~~issued ~~Production~~consolidated ~~costs~~financial payable have been broken out of accrued expenses on the Consolidated Balance Sheets. Bad debt expense has been included in selling, general and administrative on the Consolidated Statements of Operations.statements

During the quarter ended April 30, 2022, the Company identified errors that caused an understatement of previously reported current liabilities and accumulated deficit. Specifically, the error related to the lack of accrual for certain actor residuals related to Wynonna Earp incurred in 2016 and 2017. The correction of these errors increased accrued expenses and accumulated deficit each by $589,000 as of October 31, 2021 and increased accumulated deficit by $589,000 as of October 31, 2020. This error had no impact on net loss, loss per share, or net cash provided by operating activities for the years ended October 31, 2021 and 2020.

In accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the errors and determined that the impact was not material to any of the Company’s previously issued financial statements.

The following table presents a summary of the impact by financial statement line item of the corrections as of October 31, 2021 and 2020:

	As of October 31, 2021
(in thousands)	As Previously Reported			Adjustment			As Revised
Consolidated Balance Sheet
Accrued Expenses	$	3,197		$	589		$	3,786
Total current liabilities	$	8,741		$	589		$	9,330
Total liabilities	$	8,761		$	589		$	9,350

Accumulated deficit	$	(80,114	)	$	(589	)	$	(80,703	)
Total stockholders’ equity	$	22,637		$	(589	)	$	22,048

	As of October 31, 2020
(in thousands)	As Previously Reported			Adjustment			As Revised
Consolidated Balance Sheet
Accumulated deficit	$	(91,996	)	$	(589	)	$	(92,585	)
Total stockholders’ equity	$	18,225		$	(589	)	$	17,636

Income Taxes

The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in its assessment of a valuation allowance. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date of such change.

The Company uses a two-step approach for ~~recognizing~~ recognizing and measuring tax benefits taken or expected to be taken in a tax return. The Company determines whether it is more-likely-than-not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. In evaluating whether a tax position has met the more-likely-than-not recognition threshold, the Company presumes that the position will be examined by the appropriate taxing authority that has full knowledge of all relevant information. Tax positions that meet the more-likely-than-not recognition threshold are measured to determine the amount of tax benefit to recognize in the financial statements or the amount of allowance against any previously recognized benefit. The tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in one or more of the following: an increase in a liability for income taxes payable, a reduction of an income tax refund receivable, a reduction in a deferred tax asset, or an increase in a deferred tax liability (See Note ~~15 Income Taxes~~14).

F-15

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Commitments and Contingencies

The Company accrues for loss contingencies when both (a) information available prior to issuance of the consolidated financial statements indicates that it is probable that a liability had been incurred at the date of the consolidated financial statements and (b) the amount of loss can reasonably be estimated. When the Company accrues for loss contingencies and the reasonable estimate of the loss is within a range, the Company records its best estimate within the range. When no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount in the range. The Company discloses an estimated possible loss or a range of loss when it is at least reasonably possible that a loss may have been incurred.

Fair Value of Financial Instruments

The estimated fair value of financial instruments has been determined using available market information or other appropriate valuation methodologies. However, considerable judgment is required in interpreting this data to develop estimates of fair value. Consequently, the estimates are not necessarily indicative of the amounts that could be realized or would be paid in a current market exchange.

At October 31, ~~2021~~2022 and ~~2020~~2021, the carrying value of the Company’s current assets of trade accounts receivable, inventory, prepaid expenses and other current assets, trade accounts payable, accrued expenses, ~~deferred~~ ~~revenue,~~production ~~bank~~costs ~~loans~~ payable, ~~related~~deferred ~~party loans payable~~revenue, ~~government~~and ~~loans,~~ operating lease obligations, ~~and other current liabilities~~ approximated fair value because of the short period of time to maturity. At October 31, ~~2021~~2022 and ~~2020~~2021, the carrying value of the long-term portion of the Company’s operating lease obligations, ~~related party loans, government loans and bank loans~~ approximate fair value as their contractual interest rates approximate market yields for similar debt instruments.

~~Investments~~Recently Issued Accounting Pronouncements Adopted

~~Effective~~In ~~April~~March 12019, ~~2020~~the FASB issued ASU No. 2019-02, Improvements to Accounting for Costs of Films and License Agreements for Program Materials. ASU No. 2019-02 aligns the ~~Company’s~~accounting ~~interest~~for inproduction ~~Clover~~costs ~~Press~~of ~~decreased~~episodic television series with the accounting for production costs of films. It also requires an entity to 19test a film or license agreement within the scope of Subtopic 920-350 for impairment at the film group level, when the film or license agreement is predominantly monetized with other films and/or license agreements.9% The Company adopted this ASU on November 1, 2020 and ~~IDWMH~~applied noits provisions ~~longer~~prospectively. ~~consolidates~~In connection with this adoption the ~~operations~~Company ofhas ~~Clover~~evaluated ~~Press~~this guidance and determined that there were impairments (see Note 11) from substantively abandoned television costs which materially impacted the consolidated financial statements for the year ended October 31, 2021. These costs were recorded in direct cost of revenues.

~~Recently~~In ~~Issued~~December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting ~~Pronouncements~~for Income Taxes. The purpose of ASU No. 2019-12 is to continue the FASB’s ~~Adopted~~Simplification ~~Subsequent~~Initiative to ~~2020~~reduce ~~Fiscal~~complexity ~~Year~~in ~~End~~accounting standards. The amendments in ASU No. 2019-12 simplify the accounting for income taxes by removing certain exceptions related to the incremental approach for intra-period tax allocation, the requirement to recognize or derecognize deferred tax liabilities related to equity method investments that are also foreign subsidiaries, and the methodology for calculating income taxes in an interim period. The Company adopted the ASU on November 1, 2021, and adoption did not materially affect its consolidated financial statements.

In ~~March~~November ~~2019~~2021, the FASB issued ~~Accounting~~ASU ~~Standard~~2021-10, Government Assistance ~~Update~~ (~~“ASU”) No.~~Topic ~~2019-02~~832), which ~~Improvements~~requires business entities to ~~Accounting~~disclose ~~for~~information ~~Costs~~about oftransactions ~~Films~~with ~~and~~a ~~License~~government ~~Agreements~~that are accounted for ~~Program~~by ~~Materials.~~applying ~~ASU~~a ~~2019-02~~grant ~~aligns~~or ~~the~~contribution ~~accounting~~ model by analogy (for ~~production~~example, ~~costs~~IFRS ofguidance ~~episodic~~in ~~television~~IAS ~~series~~20 or ~~with~~guidance ~~the~~on ~~accounting~~contributions for not-for-profit ~~production~~entities ~~costs~~in ofASC ~~films~~958-605). ItFor ~~also~~transactions ~~requires~~within anscope, ~~entity~~the tonew ~~test a~~standard ~~film~~requires orthe ~~license~~disclosure ~~agreement~~of ~~within~~information about the ~~scope~~nature of ~~Subtopic~~the ~~920-350~~transaction, ~~for~~including ~~impairment~~significant atterms ~~the~~and ~~film~~conditions, ~~group~~as ~~level,~~well ~~when~~as the ~~film~~amounts orand ~~license~~specific ~~agreement~~financial statement line items affected by the transaction. The new guidance is ~~predominantly~~effective ~~monetized~~for ~~with~~annual ~~other~~reporting ~~films~~periods ~~and/or~~beginning ~~license~~after ~~agreements~~December 15, 2021. Early application of the amendment is permitted. The Company adopted ~~this~~the ASU on ~~November~~May 1, ~~2020~~2022 and isapplied ~~applying~~ its provisions prospectively. In connection with this adoption the Company ~~has~~increased ~~evaluated~~its ~~this~~disclosures ~~guidance~~with ~~and~~respect ~~determined~~to ~~that~~government ~~there~~assistance ~~are impairments~~beginning ~~(Note~~in ~~12) from substantively abandoned television costs which materially impacted~~ the ~~consolidated~~third ~~financial~~quarter ~~statements.~~of fiscal ~~These~~year ~~costs~~2022 ~~were~~(See ~~recorded~~Note ~~in direct cost of revenues~~15).

Recently Issued Accounting Standard Not Yet Adopted

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326), that changes the impairment model for most financial assets and certain other instruments. For receivables, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses in a manner similar to current practice, except the losses will be recognized as allowances instead of reductions in the amortized cost of the securities. In addition, an entity will have to disclose significantly more information about allowances, credit quality indicators and past due securities. The new guidance becomes effective for fiscal years beginning after December 15, 2022, though early adoption is permitted. The new provisions will be applied as a cumulative-effect adjustment to retained earnings. The Company will adopt the new standard on November 1, 2023. The Company is evaluating the impact that the new standard will have on our consolidated financial statements.

F-16

~~IDW~~Recently ~~MEDIA~~Issued ~~HOLDINGS,~~Accounting ~~INC.~~Standard Not Yet Adopted

~~NOTES~~In TOJune ~~CONSOLIDATED~~2016, ~~FINANCIAL~~the ~~STATEMENTS~~FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326), that changes the impairment model for most financial assets and certain other instruments. For receivables, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses in a manner similar to current practice, except the losses will be recognized as allowances instead of reductions in the amortized cost of the securities. In addition, an entity will have to disclose significantly more information about allowances, credit quality indicators and past due securities. The new guidance becomes effective for fiscal years beginning after December 15, 2022, though early adoption is permitted. The new provisions will be applied as a cumulative-effect adjustment to retained earnings. The Company will adopt the new standard on November 1, 2023. The Company is evaluating the impact that the new standard will have on its consolidated financial statements.

~~FOR~~In ~~THE~~January ~~FISCAL~~2017, ~~YEARS~~the ~~ENDED~~FASB ~~OCTOBER~~issued 31ASU No. 2017-04, Intangibles—Goodwill ~~2021~~and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which simplifies the measurement ~~AND~~of ~~2020~~goodwill by eliminating the Step 2 impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The new guidance requires an entity to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. Additionally, an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The new guidance becomes effective for goodwill impairment tests in fiscal years beginning after December 15, 2022, though early adoption is permitted. The Company will adopt this guideline prospectively for the fiscal year beginning November 1, 2023. The Company does not believe that the adoption of this new accounting guidance will have a material impact on its consolidated financial statements.

InNote ~~January 2017, the FASB issued ASU No. 2017-04, Intangibles~~2—~~Goodwill~~Loss ~~and~~Per Other (Topic 350): Simplifying the Test for Goodwill Impairment, which simplifies the measurement of goodwill by eliminating the Step 2 impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The new guidance requires an entity to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. Additionally, an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The new guidance becomes effective for goodwill impairment tests in fiscal years beginning after December 15, 2022, though early adoption is permitted. The Company will adopt this guideline prospectively for fiscal year November 1, 2023. The Company does not believe that the adoption of this new accounting guidance will have a material impact on its consolidated financial statements. Share

InBasic (loss) ~~December~~earnings ~~2019,~~per ~~the~~share ~~FASB~~is ~~issued~~computed ~~ASC~~by ~~Update~~dividing ~~No.~~net ~~2019-12,~~(loss) ~~Income~~income ~~Taxes (Topic~~attributable ~~740):~~to ~~Simplifying~~all ~~the~~classes ~~Accounting~~of ~~for~~common ~~Income~~stockholders ~~Taxes.~~by ~~The~~the ~~purpose~~weighted average number of ~~Update~~shares ~~No.~~of ~~2019-12~~all isclasses toof ~~continue~~common stock outstanding during the ~~FASB’s~~applicable ~~Simplification Initiative~~period. toDiluted ~~reduce~~(loss) ~~complexity~~earnings per share is computed in ~~accounting~~the ~~standards.~~same ~~The~~manner ~~amendments~~as inbasic ~~Update~~(loss) ~~No.~~earnings ~~2019-12~~per ~~simplify~~share except that the ~~accounting~~number ~~for~~of ~~income~~shares ~~taxes~~is increased to include additional shares bythat ~~removing~~would ~~certain~~have ~~exceptions~~been ~~related~~outstanding tohad the ~~incremental~~potentially ~~approach~~dilutive ~~for~~shares ~~intraperiod~~been ~~tax~~issued ~~allocation,~~and reduced by the ~~requirement~~number toof ~~recognize~~shares orthe ~~derecognize~~Company could ~~deferred~~have ~~tax~~repurchased ~~liabilities~~with ~~related~~proceeds tofrom ~~equity~~issuance ~~method~~of ~~investments~~potentially ~~that~~dilutive ~~are~~shares ~~also~~using ~~foreign~~the ~~subsidiaries~~treasury stock method, ~~and~~unless the ~~methodology~~effect ~~for~~of ~~calculating~~such ~~income~~increase ~~taxes~~would inbe ~~an interim period~~anti-dilutive. InThe ~~addition~~Company toexcluded ~~removing~~1,154,136 ~~these~~and ~~exceptions~~85,999 ~~Update~~shares ~~No.~~of ~~2019-12~~unvested ~~also~~restricted ~~clarifies~~Class ~~and~~B ~~simplifies~~common ~~other~~stock, ~~aspects~~options ofto ~~the~~purchase ~~accounting~~996,357 ~~for~~and ~~income~~302,737 ~~taxes.~~shares ~~Update~~of ~~No.~~Class ~~2019-12~~B iscommon ~~effective~~stock ~~for~~and ~~fiscal~~warrants ~~years~~to purchase 187,579 and ~~interim~~187,579 ~~periods~~shares ~~within~~of ~~those~~Class ~~fiscal~~B ~~years,~~common stock ~~beginning~~from ~~after~~the ~~December~~calculation ~~15,~~of ~~2020.~~diluted ~~The~~loss ~~Company~~per ~~will~~share ~~adopt~~for ~~ASU~~the ~~2019-12~~fiscal ~~effective~~years ~~November~~ended 1October 31, ~~2021.~~2022 ~~The~~and ~~Company~~2021, ~~does~~respectively, ~~not~~as ~~believe~~the ~~that~~effect ~~the~~would ~~adoption~~have ofbeen ~~this~~anti-dilutive. ~~new~~Therefore, ~~accounting~~basic ~~guidance~~and ~~will~~diluted ~~have~~(loss) aearnings ~~material~~per ~~impact~~share onare ~~its~~the ~~consolidated~~same ~~financial~~for ~~statements~~the fiscal years ended October 31, 2022 and 2021.

Note 2—Earnings Per Share

Basic income (loss) per share is computed by dividing net income (loss) attributable to all classes of common stockholders by the weighted average number of shares of all classes of common stock outstanding during the applicable period. Diluted income (loss) per share is computed in the same manner as basic income (loss) per share except that the number of shares is increased to include restricted stock still subject to risk of forfeiture (non-vested) using the treasury stock method, unless the effect of such increase would be anti-dilutive. The Company excluded 85,999 and 38,000 shares of unvested restricted stock, 302,737 and 242,735 stock options, and 187,579 of warrants from the calculation of diluted income (loss) per share for the fiscal years ended October 31, 2021 and 2020, respectively, as the effect would have been anti-dilutive. Therefore basic and diluted are the same for the fiscal years ended October 31, 2021 and 2020.

Note 3—Equity

On August 6, 2021, the Company closed a registered public offering of Class B common stock and EF Hutton, as representative of the Underwriters, exercised the overallotment option included as part of the offering in full. The Company sold an aggregate of 2,875,000 shares of the Company’s Class B common stock for gross consideration of $10,350,000 less underwriters’ commissions of $724,500 and underwriters’ expenses of $75,000.

On July 1614, ~~2020~~2021, the ~~Company~~number ~~settled its intercompany~~authorized ~~payable~~shares toof ~~CTM~~the ~~totaling~~Company’s ~~$6,982,305~~Class ~~and~~B ~~subsequently~~common ~~received~~stock awas ~~distribution~~increased offrom $612,~~800~~000,000 ~~from CTM. This transaction was booked into additional paid in capital with CTM and IDWMH~~ to ~~have an immaterial impact and did not trigger any tax impacts~~20,000,000.

On ~~July~~December 1431, ~~2021~~2020, 6,710 shares of Class B common stock were issued to the Company’s ~~board~~Chairman, for payment of ~~directors~~ ~~authorized~~interest on the ~~increase~~loan ofagreement ~~Class~~related Bto ~~Common~~the ~~Stock~~related ~~shares~~party ~~from~~loan that ~~12,000,000~~was topaid ~~20,000,000,~~off ~~subject~~as toof ~~stockholder~~as ~~approval~~part atof the ~~Company’s~~ ~~2022~~sale ~~Annual~~of ~~Meeting~~CTM ofon ~~Stockholders~~February 15, 2021 (see Note 16).

On July 13, 2020, the Company issued 314,070 shares of Class B Common Stock to the Chairman, pursuant to a Loan Modification Agreement in which the Chairman and the Company agreed to convert $1.25 million of indebtedness on the loan agreement owed by the Company to the Chairman to such 314,070 shares.

F-17

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

On March 9, 2020, the Company closed a private placement of shares of Class B Common Stock at $6.00 per share, pursuant to which the Company issued 2,051,002 shares of Class B Common Stock for gross proceeds of approximately $12,300,000 inclusive of $4.0 million debt-to-equity conversion by the Chairman on the bridge loan agreement. The shares issued were subject to a contractual restriction on transfer for six months following the closing of the placement and are subject to other restrictions under applicable law. The proceeds from the issuance of Class B Common Stock have been netted with $415,000 of costs related to the private placement.

Voting Privileges and Protective Features

Each holder of outstanding shares of Class B ~~Common~~common ~~Stock~~stock ~~are~~is entitled to cast the number of votes equal to one tenth of the whole shares of ~~Common~~Class ~~Stock~~B common stock held by such holder. Each holder of outstanding shares of Class C ~~Common~~common ~~Stock~~stock ~~are~~is entitled to cast the number of votes equal to three times the whole shares of ~~Common~~ ~~Stock~~Class C common stock held by such holder. Each series of ~~Common~~preferred ~~Stock~~stock, ~~will~~if any, are designated and issued, will have such number of shares, designations, preferences, voting powers, qualifications and special or relative rights or privileges as shall be determined by ~~our~~the Company’s Board of Directors, which may include, among others, dividends, voting rights, and liquidation preferences.

Restricted Stock

The fair value of restricted shares of the Company’s Class B common stock is determined based on the closing price of the Company’s Class B common stock on the grant date. Share awards generally vest on a graded basis over three years of service.

A summary of the status of the Company’s grants of restricted shares of Class B common stock is presented below:

	Number of Non-vested Shares			Weighted Average Grant Date Fair Value
Outstanding at October 31, 2020		38,000		$	9.28
Granted		70,002			3.89
Vested		(22,003	)		10.10
Cancelled / Forfeited		-			-
Non-vested shares at October 31, 2021		85,999		$	4.68

At October 31, 2021, there was $344,000 of total unrecognized compensation cost related to non-vested stock-based compensation arrangements, which is expected to be recognized over the next 3 years.

Detailed below are shares of Class B Common Stock issued to the Chairman, for payment of interest on the loan agreement, the related party loan has been paid off. (Note 5). There was an additional 14,902 shares issued in fiscal 2020 for interest on the related party bridge loan paid off in fiscal 2020.

F-18

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

	Number of Shares
Date	Fiscal 2021		Fiscal 2020
December 31, 2020		6,710		-
September 30, 2020		-		9,710
June 30, 2020		-		10,335
March 31, 2020		-		14,816
January 9, 2020		-		36,586
Total shares		6,710		71,447

Warrants

Detailed below are outstanding warrants issued to the Company’s Chairman associated with the two loans made by the Chairman to the Company, (which ~~loans~~ have subsequently been repaid):. The exercise price and expiration of these warrants were amended on March 29, 2022. The 98,336 shares had an original exercise price of $26.44 and were set to expire on March 30, 2022. The 89,243 shares had an original exercise price of $42.02. No additional compensation cost was incurred from the modification.

Number of Shares	Type of Share	Exercise Price		Expiration	~~Expiration~~
98,336	Class B ~~Common~~common ~~Stock~~stock	$	261.4494	August 21, 2023	~~March 30, 2022~~
89,243	Class B ~~Common~~common ~~Stock~~stock	$	421.0294	August 21, 2023	~~August 21, 2023~~

Note 4—Stock Based Compensation

2019 Stock Option and Incentive Plan

On March 14, 2019, the Company’s Board of of Directors adopted the 2019 IDW Stock Option and Incentive Plan (“2019 Incentive Plan”) to provide incentives to executive officers, employees, directors, and consultants of the Company and/or its subsidiaries and reserved 300,000 shares of Class B ~~Common~~common ~~Stock~~stock for the grant of awards under the 2019 Incentive Plan, subject to adjustment. Incentives available under the 2019 Incentive Plan may include stock options, stock appreciation rights, limited stock appreciation rights, restricted stock, and deferred stock units. On July 13, 2020, the Board of Directors of the Company increased the number of shares of Class B ~~Common~~common ~~Stock~~stock reserved for the grant of awards under the 2019 Incentive Plan to 450,000, subject to adjustment. On March 11, 2021, the Board of Directors of the Company increased the number of shares of Class B ~~Common~~common ~~Stock~~stock reserved for the grant of awards under the 2019 Incentive Plan to 700,000, subject to adjustment. On November 8, 2021, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 1,350,000. The increase was approved on April 5, 2022 at the Company’s 2022 Annual Meeting of Stockholders. On January 13, 2022, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 2,550,000. The increase was approved on April 5, 2022 at the Company’s 2022 Annual Meeting of Stockholders. Options are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those options generally vest based on 3 years of continuous service and have 10-year contractual terms. As of October 31, ~~2021~~2022, ~~256~~287,~~483~~795 shares remained available to be awarded under the 2019 Incentive Plan.

F-1918

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of the Company’s stock options for employees is equal to the contractual life of the option. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve. Expected dividend is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The assumptions used to estimate the fair value of stock options granted during the periods presented were as follows:

		October 31, 2021	October 31, 2020
	October 31, 2022			October 31, 2021
Expected volatility		7172.62%-72.17%		~~71.3%-76.0%~~	71.6%-72.1%
Dividend yield		-		-	-
Risk-free interest		1.0134%-13.6810%		~~0.60%-1.76%~~	1.01%-1.68%
Expected Life (years)		10		10	10

The following table summarizes stock option activity during the year ended October 31, ~~2021~~2022.

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at October 31, 2020		242,735		$	6.13		1.33	$	-
Outstanding at October 31, 2021		302,737		$	5.69		7.81	$	-
Granted		~~130~~768,~~002~~620			42.0733		29.4719		-
Exercised		-			-		-		-
Cancelled / Forfeited		(7075,000	)		45.2021		-		-
Outstanding at October 31, 2021		302,737		$	5.69		1.55	$	-
Outstanding at October 31, 2022		996,357		$	3.13		8.88	$	-
Exercisable at October 31, 2021		107,737		$	7.62		0.93	$	-
Exercisable at October 31, 2022		299,282		$	4.76		8.24	$	-

The weighted-average grant-date fair value of options granted during the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~2021 was $1.9335 and $31.0693, respectively.

At October 31, ~~2021~~2022, unamortized stock compensation for stock options was $~~302~~890,000, with a weighted average recognition period of 2.018 years.

~~Non-cash~~Restricted compensation for stock options and restricted stock issued to employees and non-employees included in selling, general and administrative expenses for continuing operations was $329,000 and $1,131,000 in the fiscal years ended October 31, 2021 and 2020, respectively.Stock

~~2009~~The ~~Incentive~~fair ~~Plan~~value of restricted shares of the Company’s Class B common stock is determined based on the closing price of the Company’s Class B common stock on the grant date. Share awards generally vest on a graded basis over three years of service.

On September 3, 2009, the Company’s Compensation Committee ratified the 2009 Incentive Plan to provide incentives to executive officers, employees, directors and consultants of the Company and/or its subsidiaries. The maximum number of shares of Class B Common Stock reserved for the grant of awards under the 2009 Incentive Plan was 285,860 shares. Incentives that were available to be granted under the 2009 Incentive Plan included stock options, stock appreciation rights, limited stock appreciation rights, restricted stock and deferred stock units. Pursuant to the 2009 Incentive Plan, as of August 2019 no new awards may be issued under that plan. As of October 31, 2021, there remained outstanding 10,000 options that were awarded to one employee under the 2009 Incentive Plan. These vested options which had a 10F-~~year term, will be cancelled, unless exercised, on January 30, 2022, which is 180 days after the employee’s termination.~~19

~~F-20~~A summary of the status of the Company’s grants of restricted shares of Class B common stock is presented below:

IDW MEDIA HOLDINGS, INC.

	Number of Non-vested Shares			Weighted Average Grant Date Fair Value
Outstanding at October 31, 2021		85,999		$	4.68
Granted		1,116,568			1.81
Vested		(46,931	)		4.14
Cancelled / Forfeited		(1,500	)		4.88
Non-vested shares at October 31, 2022		1,154,136		$	1.93

~~NOTES~~On TOJanuary ~~CONSOLIDATED~~5, ~~FINANCIAL~~2022, ~~STATEMENTS~~11,596 restricted shares of the Company’s Class B common stock were issued to members of the Company’s Board of Directors which vested immediately upon grant.

~~FOR~~On ~~THE~~April ~~FISCAL~~1, ~~YEARS~~2022, ~~ENDED~~1,500 ~~OCTOBER~~shares ~~31,~~were ~~2021~~cancelled ~~AND~~in ~~2020~~connection with the termination of a non-employee’s services for the Company.

~~Note~~On April 5~~—Loans~~, 2022, 1,104,972 restricted shares of the Company’s Class B common stock were issued to the Company’s Chairman in and have a vesting period of 5 years. These shares were issued in lieu of cash compensation for his employment services over the vesting period.

~~Related~~At ~~party~~October ~~loans~~31, 2022, there was $1,948,000 of total unrecognized compensation cost related to non-vested restricted shares stock-based compensation arrangements, which is expected to be recognized over the next 4.5 years.

OnNon-cash ~~August~~compensation ~~21, 2018, the Company entered into a loan agreement with the Company’s Chairman of the Board of Directors~~ for ~~$5,000,000.~~stock ~~Interest~~options ~~accrued at prime rate plus 1%~~ and restricted ~~the~~stock ~~loan~~issued ~~was due~~ to ~~mature~~employees ~~on August 20, 2022. Payment of principal~~ and ~~interest~~non-employees ~~were~~included ~~payable from 70% of the Free Cash Flow, as defined~~ in ~~the loan agreement~~selling, ofgeneral the Company’s CTM Media Group Inc. subsidiary. All outstanding shares of CTM Media Group Inc. stock were pledged as security under the agreement. On December 1, 2019, the Company amended the agreement providing that up to 60% of the interest due may, at the option of the Company, be paid in shares of Class B common stock (and ~~the~~administrative ~~remaining~~expenses ~~amount in cash) with such shares valued based on the average closing prices~~ for ~~the~~continuing ~~Class~~operations ~~B common stock on the ten trading days immediately prior to the applicable interest due date. The cumulative shares issued in connection with the loan interest~~ was 63$745,~~255. The interest was to be paid quarterly on the~~000 ~~loan. In~~and ~~conjunction with the loan, the Company issued the lender a warrant to purchase up to 89,243 shares of the Company’s Class B Common Stock with an exercise price of~~ $~~42.02. The warrant expires August 21~~329, ~~2023. On July 13, 2020, $1,250,~~000 ~~was~~in ~~converted into~~the ~~314,070~~fiscal ~~shares~~years ofended ~~Class~~October ~~B Common Stock (Note 3). On February 15~~31, ~~2021~~2022 ~~the Company closed the previously announced CTM Sale~~ and ~~since the loan balance equaled the purchase price~~ 2021,~~the~~ ~~Company wrote down the loan of $3,750,000 to an outstanding balance of nil~~respectively.

InNote ~~the~~5—Business ~~fiscal~~Segment ~~years ended October 31, 2021 and 2020, the Company charged $41,000 and $406,000, respectively of interest expense to production costs.~~Information

~~Bank~~The ~~loans~~Company has the following reportable business segments: IDWP, IDWE and CTM (discontinued operations).

On November 21, 2018, a VIE (Note 1) controlled by IDWE entered into a loan agreement with a bank that provides for a production financing commitment in the aggregate amount up to CAD $27,700,000. The loan is secured by the VIE’s assets, rights in the related television production’s episodes and distribution agreements for the production and is repayable from the assignment of proceeds of the related license agreements and tax credits, including interest based on the prime rate. IDWE is the guarantor on the loan. The loan has been paid off in full on May 3, 2021.

On June 21, 2018, a VIE controlled by IDWE entered into a loan agreement with a bank that provides for a production financing commitment in the aggregate amount up to CAD $23,521,000. The loan is secured by the VIE’s assets, rights in the related television production’s episodes and distribution agreements for the production and is repayable from the assignment of proceeds of the related license agreements, including interest based on the prime rate. IDWE is the guarantor on the loan. This loan was refinanced on January 4, 2021 with Royal Bank of Canada for a credit facility of CAD $7,868,000 for the purpose of interim financing certain receivables. The loan has been paid off in full on May 10, 2021.

In the fiscal years ended October 31, 2021 and 2020, the Company charged $184,000 and $1,087,000, respectively of interest expense to production costs.

F-21

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Government loans

On April 2, 2021, the Company received loan proceeds of $1,195,680 (the “PPP Loan”) from Bank of America, N.A. pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, as amended. The PPP Loan, which was in the form of a Note dated April 1, 2021 issued by the Company, matures on April 1, 2026 and bears interest at a rate of 1% per annum, payable monthly commencing on November 2, 2021. The Note may be prepaid by the Company at any time prior to maturity with no prepayment penalties. Funds from the PPP Loan may only be used for payroll costs, costs used to continue group health care benefits, mortgage payments, rent, utilities, and interest on certain other debt obligations. Under the terms of the PPP, certain amounts of the PPP Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. The Company used the entire PPP Loan amount for qualifying expenses. On October 27, 2021, the Company received notification from the Lender that the SBA had approved the Company’s PPP Loan forgiveness application for the entire PPP Loan amount. The forgiveness of the PPP Loan was recognized during the quarter ending October 31, 2021. In the fiscal year ended October 31, 2021, $6,000 of interest expense was incurred and reversed into other income once forgiven.

On April 27, 2020, the Company received loan proceeds of $1,195,679 (the “IDWMH PPP Loan”) from Bank of America, N.A. pursuant to the PPP under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The IDWMH PPP Loan, which was in the form of a Note dated April 15, 2020 issued by the Company, matures on April 15, 2022 and bears interest at a rate of 1% per annum, payable monthly commencing on November 24, 2020. The Note may be prepaid by the Company at any time prior to maturity with no prepayment penalties, and under the terms of the loan, payments can be deferred for six months. Funds from the IDWMH PPP Loan may be used primarily for payroll costs and costs used to continue group health care benefits, and, up to a limited extent, on mortgage payments, rent, utilities, interest and other expenses as described in the CARES Act. Under the terms of the PPP, certain amounts of the IDWMH PPP Loans may be forgiven if they are used for those qualifying expenses. The Company used the entire IDWMH PPP Loan amount for those qualifying expenses. On July 20, 2021, the Company received notification from the Lender that the SBA had approved the Company’s PPP Loan forgiveness application for the entire PPP Loan amount. The forgiveness of the PPP Loan was recognized during the quarter ending July 31, 2021. In the fiscal year ended October 31, 2021, $8,000 of interest expense was incurred and reversed into other income once forgiven. In the fiscal year ended October 31, 2020, $6,000 of interest expense was incurred.

Note 6—Business Segment Information

The Company has the following three reportable business segments: IDWP, IDWE and CTM (discontinued operations).

The Company’s reportable segments are distinguished by types of service, customers and methods used to provide their services. The operating results of these business segments are regularly reviewed by the Company’s chief operating decision maker. The Company evaluates the performance of its business segments based primarily on operating income. The accounting policies of the segments are the same as the accounting policies of the Company as a whole.

~~Total~~Operating ~~Assets~~results ~~(in~~and ~~thousands)~~assets for the business segments of the Company are as follows:

October 31, 2021 for IDWP $14,216, IDWE $2,998 and IDWMH $14,184

(in thousands)	IDWP			IDWE(a)			CTM			IDWMH(b)			Total
							(discontinued operations)			(unallocated overhead)
Fiscal year ended October 31, 2022
Revenues	$	25,839		$	10,255		$	-		$	-		$	36,094
(Loss) income from operations		(1,897	)		3,149			-			(1,937	)		(685	)
Net (loss) income		(1,908	)		3,164			-			(2,004	)		(748	)
Fiscal year ended October 31, 2021
Revenues	$	25,284		$	7,141		$	-		$	-		$	32,425
Loss from operations		(770	)		(6,690	)		-			(1,225	)		(8,685	)
Loss from discontinued operations, net		-			-			(1,281	)		-			(1,281	)
Net (loss) income		(770	)		(6,582	)		(1,281	)		3,241			(5,392	)

~~October~~(a) ~~31,~~IDWE ~~2020~~includes ~~for~~Thought ~~IDWP $15,189,~~Bubble ~~IDWE~~LLC ~~$22,091,~~and ~~CTM~~Word ~~(discontinued~~Balloon ~~operations)~~LLC ~~11,171~~which ~~and~~consist ~~IDWMH~~of ~~$6,207~~only television costs.

~~F-22~~(b) The parent company, IDWMH, reported net income in the fiscal year ended October 31, 2021 as a result of PPP loan forgiveness and the sale of CTM.

~~IDW MEDIA HOLDINGS, INC.~~F-20

~~NOTES~~Total ~~TO CONSOLIDATED FINANCIAL STATEMENTS~~Assets

~~FOR~~At ~~THE~~October ~~FISCAL~~31, ~~YEARS~~2022 ~~ENDED~~total ~~OCTOBER~~assets ~~31,~~were ~~2021~~$13,650,000 ~~AND~~at ~~2020~~IDWP, $3,663,000 at IDWE, and $10,628,000 at IDWMH.

~~Operating~~At ~~results~~October ~~for~~31, ~~the~~2021 ~~business~~total ~~segments~~assets ofwere ~~the~~$14,216,000 ~~Company~~at ~~are~~IDWP, as$2,998,000 at ~~follows:~~IDWE, and $14,184,000 at IDWMH.

(in thousands) (unaudited)	IDWP(a)			IDWE(b)			CTM			IDWMH			Total
							(discontinued operations)			(unallocated overhead)
Fiscal year ended October 31, 2021
Revenues	$	25,284		$	7,141		$	-		$	-		$	32,425
Loss from operations		(770	)		(6,690	)		-			(1,225	)		(8,685	)
Loss from discontinued operations, net		-			-			(1,281	)		-			(1,281	)
Net loss		(770	)		(6,582	)		(1,281	)		3,241			(5,392	)
Total assets at October 31, 2021		14,216			2,998			-			14,184			31,398
Fiscal year ended October 31, 2020
Revenues	$	23,850		$	14,312		$	-		$	-		$	38,162
Loss from operations		(103	)		(8,589	)		-			(632	)		(9,324	)
Loss from discontinued operations, net		-			-			(4,110	)		-			(4,110	)
Net loss		(103	)		(8,589	)		(4,110	)		(996	)		(13,798	)
Total assets at October 31, 2020		15,189			22,091			11,171			6,207			54,658

Note 6—Trade Accounts Receivable and Deferred Revenue

(a) IDWP includes Clover Press through March 31, 2020. As of April 1, 2020, Clover Press was valued at the cost method and was no longer consolidated.

(b) IDWE includes Thought Bubble LLC and Word Balloon LLC which consist of only television costs.

Note 7 —Trade Accounts Receivable and Deferred Revenue

Trade accounts receivable consists of the following:

(in thousands)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Trade accounts receivable	$	56,558		$	235,~~246~~558
Less allowance for sales returns		(~~127~~110	)		(~~296~~127	)
Less allowance for doubtful accounts		-			(29	)
Trade accounts receivable, net	$	6,448		$	5,431
Trade accounts receivable, net	$	5,431		$	22,921

The opening balance of trade accounts receivable as of November 1, 2019 was $43,462,000.

Changes in deferred revenue consist of the following:

(in thousands)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Beginning Balance	$	2,~~385~~045		$	12,~~058~~385
Deferral of revenue		609			2,725
Performance obligations satisfied during the period that were included in the deferred revenue balance at the beginning of the year		(2,045	)		(543	)
Recognition of deferred revenue		(927	)		(1,398	)
Increases due to invoicing prior to satisfaction of performance obligations		-			226
Return of previously collected funds		~~(22~~-	)		-(23	)
Ending Balance	$	~~2,045~~-		$	2,~~385~~045

~~The~~Contract liabilities are recorded as deferred revenue when customer payments are received in advance of the Company ~~expects~~meeting toall ~~satisfy~~the ~~its~~revenue recognition criteria under ASC 606. Generally, the remaining performance obligations ~~and~~ ~~recognize~~will ~~approximately~~be ~~100%~~satisfied ofwithin ~~this~~twelve ~~revenue~~months ~~over~~after ~~the~~prepayment. ~~next~~During 12the ~~months~~fiscal ~~ending~~years ended October 31, 2022 and 2021, significant changes in the deferred revenue balances were the result of revenue recognized and net cash received related to direct-to-consumer games campaigns.

~~F-23~~Note 7— Inventory

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Note 8 — Inventory

Inventory consists of the following:

(in thousands)	October 31, ~~2021~~2022		October 31, ~~2020~~2021
Work in progress	$	~~495~~454	$	~~1,004~~495
Finished goods		23,~~595~~831		2,~~750~~595
Total	$	34,~~090~~285	$	3,~~754~~090

~~Note 9 — Prepaid Expenses~~ F-21

Note 8—Prepaid ~~expenses~~Expenses ~~consist~~and ofother ~~the~~current ~~following:~~assets

(in thousands)	October 31, 2021		October 31, 2020
Royalties and deposits	$	1,215	$	1,061
Insurance		225		134
Other prepaids		830		166
Total	$	2,270	$	1,361

Prepaid expenses and other current assets consist of the following:

Note 10—Property and Equipment

(in thousands)	October 31, 2022		October 31, 2021
Royalties and deposits	$	1,242	$	1,215
Insurance		672		225
Games printing		104		703
Employer retention credit receivable (see Note 15)		436		-
Other prepaids		260		127
Total	$	2,714	$	2,270

Note 9—Property and Equipment

Property and equipment consist of the following:

(in thousands)	October 31, ~~2021~~2022			October 31, ~~2020~~2021
Equipment	$	~~557~~521		$	~~424~~557
Furniture and Fixtures		~~106~~310			~~105~~106
Leasehold improvements		~~827~~169			~~826~~827
Computer software		24			2024
Total		1,~~514~~024			1,~~375~~514
Less accumulated depreciation		(~~1,167~~299	)		(~~965~~1,167	)
Property and equipment, net	$	~~347~~725		$	~~410~~347

Depreciation expense totaled $~~201~~190,000 and $~~200~~201,000 for fiscal ~~2021~~years ended October 31, 2022 and ~~2020~~2021, respectively. During the fiscal year ended October 31, 2022, the Company disposed of leasehold improvements, computers, furniture, and other equipment as a result of the office relocations and the expiration of the warehouse lease, resulting in the removal of $1,073,000 from gross property and equipment and $1,059,000 from accumulated depreciation.

~~F-24~~Note 10—Intangible Assets

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Note 11— Intangible Assets

Intangible assets consist of the following:

					October 31, 2021
(in thousands)	Amortization Period		October 31, 2022				October 31, 2021
	Amortization Period				Gross Carrying Amount				Additions		Impairments		Accumulated Amortization			Net Book Value
Licensing contracts	7 years		$	893			$	893
Amortized intangible assets:
Software	5 years			769				-
Licensing contracts		7 years			$	893			$	—	$	—	$	(886	)	$	7
Total amortized intangible assets				1,662				893
						893				—		—		(886	)		7
Database development costs				235				672
In-process intangible assets:
Total in-process intangible assets				235				672
Software development costs						—				672		—		—			672
Less accumulated depreciation				(1,038	)			(886	)
						—				672		—		—			672
Intangible assets, net			$	859			$	679
Total					$	893			$	672	$	—	$	(886	)	$	679

			October 31, 2020
	Amortization Period		Gross Carrying Amount		Additions		Impairments		Accumulated Amortization			Net Book Value
Amortized intangible assets:
Licensing contracts		7 years	$	893	$	—	$	—	$	(841	)	$	52
				893		—		—		(841	)		52
In-process intangible assets:
Software development costs				—		—		—		—			—
				—		—		—		—			—
Total			$	893	$	—	$	—	$	(841	)	$	52

F-22

Amortization expense totaled $45152,000 and $5245,000 for the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~2021, respectively.

As of October 31, ~~2021~~2022, the estimated amortization expense for intangible assets for each of the succeeding five years and thereafter is as follows (excludes in process intangible assets):

(in thousands)
2022		7
Fiscal years ending October 31:
Total	$	7
2023		156
2024		156
2025		156
2026		156
2027 and thereafter		-
Total	$	624

~~F-25~~Note 11—Television costs and amortization

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Note 12 —Television costs and amortization

Television costs consist of the following:

(in thousands)	October 31, ~~2021~~2022		October 31, ~~2020~~2021
In-production	$	-	$	~~435~~-
In-development		1,~~487~~486		21,~~491~~487
Total	$	1,~~487~~486	$	21,~~926~~487

(in thousands)	October 31, ~~2021~~2022		October 31, ~~2020~~2021
Television cost amortization	$	51,~~414~~348	$	165,~~808~~414
Television cost impairments		~~2,216~~277		2,216
Total	$	71,~~630~~625	$	167,~~808~~630

Amortization expense for television costs is expected to be approximately $~~1,967,000~~0 over the next twelve months ending October 31, 2023. The impairments in the fiscal year ended October 31, 2022 were due to management’s periodic assessment of in-development projects resulting in write-offs of costs for projects that have expired or are no longer being pursued. The impairment in the fiscal year ended October 31, 2021 relates to the adoption of ASU 2019-02 (See Note 1).

~~Note 13 —Accrued Expenses~~F-23

Note 12—Accrued Expenses

Accrued expenses consist of the following:

(in thousands)	October 31, ~~2021~~2022		October 31, ~~2020~~2021
Royalties	$	~~1,410~~813	$	1,~~268~~410
Payroll, bonus, accrued vacation and payroll taxes		1,304		844
Residuals		65		709
Other		483		346
Payroll, bonus, accrued vacation and payroll taxes		1,623		1,304
Total	$	3,197	$	2,458
Executive producing fees		325		-
Printing		173		21
Other		354		342
Total	$	3,353	$	3,786

Note 1413—Commitments

Lease Commitments

The Company has various lease agreements with remaining terms up to 34.75 years, including leases of office space, ~~warehouses,~~ and equipment. Some leases include options to purchase, terminate or extend for one or more years. These extension options are included in the lease term when it is reasonably certain that the option ~~will~~ will be exercised.

The assets and liabilities from operating leases are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term leases, which have an initial term of 12 months or less, are not recorded on the balance sheet.

The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, wethe ~~use~~Company aestimated ~~discount~~its incremental borrowing rate to discount the lease payments based on ~~our~~information ~~incremental~~available ~~borrowing~~at ~~rate,~~either ~~which~~the ~~is determined~~implementation ~~using~~date ~~the~~of ~~Company’s~~Topic ~~interest~~842 ~~rate~~or onat ~~its~~lease ~~line~~commencement offor ~~credit~~leases entered thereafter.

FOn April 5, 2022, the Company entered into an operating lease for 3,334 square feet of general office space at 2355 Northside Drive, Suite 140, San Diego, CA pursuant to a 39-26month lease that commenced on June 1, 2022. The Company pays rent of $126,000 annually, subject to annual escalations of 3%.

~~IDW~~On ~~MEDIA~~June ~~HOLDINGS~~27, ~~INC~~2022, the Company entered into an operating lease for 4,734 square feet of general office space at 14144 Ventura Blvd, Suite 210, Sherman Oaks, CA pursuant to a 60-month lease that commenced on August 1, 2022. The Company pays rent of $174,000 annually, subject to annual escalations of 3%.

~~NOTES~~The TOCompany’s ~~CONSOLIDATED~~weighted-average ~~FINANCIAL~~remaining lease ~~STATEMENTS~~term relating to its operating leases is 4.05 years, with a weighted-average discount rate of 5.73% as of October 31, 2022.

~~FOR~~The ~~THE~~Company ~~FISCAL~~recognized ~~YEARS~~lease ~~ENDED~~expense ~~OCTOBER~~for its operating leases of $423,000 and $500,000 for the fiscal years ended October 31, 2022 and 2021, respectively. The cash paid under operating leases ~~AND~~was ~~2020~~$457,000 and $594,000 for the fiscal years ended October 31, 2022 and 2021, respectively.

~~The~~At October 31, 2022, the Company’s ~~weighted-average~~had ~~remaining~~a ~~lease~~right-of-use-asset ~~term~~related ~~relating~~ to ~~its~~ operating leases isof ~~0.74 years~~$2,028,000 ~~with~~and aaccumulated ~~weighted-average~~amortization ~~discount~~related ~~rate~~to operating leases of ~~4.59%~~$871,000, both of which are included as a component of right-of-use assets. At October 31, 2021, the Company had a right-of-use-asset related to operating leases of $1,037,000 and accumulated amortization related to operating leases of $735,000.

The Company recognized lease expense for its operating leases of $500,000 and $618,000 for the fiscal years ended October 31, 2021 and 2020, respectively. The cash paid under operating leases was $594,000 and $686,000 for the fiscal years ended October 31, 2021 and 2020, respectively.F-24

AtAs of October 31, ~~2021~~2022, ~~the~~future ~~Company~~minimum ~~had~~lease ~~a right-of-use-asset~~payments ~~related~~required tounder operating leases ~~of $1,037,000, accumulated amortization related to operating leases of $735,000, both of which~~ are ~~included~~ as a component of right-of-use assets. At October 31, 2020, the Company had a right-of-use-asset related to operating leases of $1,037,000 and accumulated amortization related to operating leases of $266,000.follows:

As of October 31, 2021, future minimum lease payments required under operating leases are as follows:

Maturity of Lease Liability (in thousands)	Total
Fiscal years ending October 31:
2023	$	340
2024		342
2025		320
2026		191
Thereafter		146
Total minimum lease payments		1,339
Less: imputed interest		(150	)
Present value of future minimum lease payments	$	1,189

Maturity of Lease Liability (in thousands)	Total
Fiscal years ending October 31:
2022	$	354
2023		13
2024		7
2025		-
Thereafter		-
Total minimum lease payments	$	374
Less: imputed interest		(6	)
Present value of future minimum lease payments	$	368

Note 14—Income Taxes

Note 15—Income Taxes

Significant components of the Company’s deferred tax assets and deferred tax liabilities consist of the following:

Fiscal year Ended October 31 (in thousands)	~~2021~~2022			~~2020~~2021
Deferred tax assets:
Bad debt reserve	$	-		$	8
Accrued expenses	$	348		$	231
Accrued expenses		231			303
Exercise of stock options and lapsing of restrictions on restricted stock		1,629			1,453
Exercise of stock options and lapsing of restrictions on restricted stock		1,453			1,360
Impairment		-			391
Impairment		391			391
Amortization		895			1,791
Amortization		1,791			2,686
Net operating loss		16,143			15,004
Net operating loss		15,004			12,280
Total deferred tax assets		19,015			18,870
Total deferred tax assets		18,870			17,028
Valuation allowance		(19,015	)		(18,870	)
Valuation allowance		(18,870	)		(17,028	)
Net Deferred Tax Assets	$	-		$	-

F-27

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

The (benefit from) provision for income taxes consists of the following:

Fiscal year ended October 31 (in thousands)		2021		2020
Current:
Federal	$	-	$	-
State and local		-		-
Foreign		-		-
	$	-	$	-
Deferred:
Federal	$	-	$	-
State and local		-		-
Foreign		-		-
	$	-	$	-
(Benefit from) provision for income taxes	$	-	$	-

The differences between income taxes expected at the U.S. federal statutory income tax rate and income taxes provided are as follows:

Fiscal year ended October 31 (in thousands)	~~2021~~2022			~~2020~~2021
U.S. federal income tax at statutory rate	$	(~~865~~167	)	$	(~~2,034~~865	)
Change in valuation allowance		~~1,875~~145			21,~~651~~875
State and local income tax, net of federal benefit		(~~512~~56	)		-(512	)
Tax law change		~~(502~~-	)		(~~620~~502	)
Non-deductible expenses		4-			34
Other		78			-
(Benefit from) provision for income taxes	$	-		$	-

At October 31, ~~2021~~2022, the Company had federal ~~net~~ net operating loss carryforwards of approximately $5458 million. These carry-forward losses are available to offset future U.S. federal ~~taxable~~ taxable income. The pre-fiscal year 2019 net operating loss carryforwards will start to expire in fiscal 2030 and post-fiscal year 2019 losses of of $4650 million will not expire.

~~The change in the valuation allowance in fiscal 2021 was as follows:~~F-25

(in thousands)	Balance at beginning of year		Additions charged to costs and expenses		Deductions		Balance at end of year
Reserves deducted from deferred income taxes, net:
Valuation allowance	$	17,028	$	1,875	$	33	$	18,870

The change in the valuation allowance in fiscal 2022 was as follows:

At October 31, 2018, the company performed an analysis of its deferred tax assets and determined that it is not more likely than not that they will be utilized and has established a valuation allowance against the asset. The valuation allowance remains.

(in thousands)	Balance at beginning of year		Additions charged to costs and expenses		Deductions			Balance at end of year
Reserves deducted from deferred income taxes, net:
Valuation allowance	$	18,870	$	223	$	(78	)	$	19,015

~~F-28~~At October 31, 2022, the Company performed an analysis of its deferred tax assets and determined that it is not more likely than not that they will be utilized and has established a valuation allowance against the asset.

~~IDW~~At ~~MEDIA~~October ~~HOLDINGS~~31, ~~INC~~2022 and 2021, the Company did not have any unrecognized income tax benefits. There were no changes in the balance of unrecognized income tax benefits in fiscal 2022 and fiscal 2021. At October 31, 2022, the Company did not expect any changes in unrecognized income tax benefits during the next twelve months. In fiscal 2022 and fiscal 2021, the Company did not record any interest and penalties on income taxes. At October 31, 2022 and 2021, there was no accrued interest included in current income taxes payable.

~~NOTES~~The TOCompany ~~CONSOLIDATED~~currently ~~FINANCIAL~~remains ~~STATEMENTS~~subject to examinations of its tax returns as follows: U.S. federal tax returns for fiscal 2019 to fiscal 2022, state and local tax returns generally for fiscal 2019 to fiscal 2022.

~~FOR~~Note ~~THE~~15—Employee ~~FISCAL~~Retention ~~YEARS ENDED OCTOBER 31, 2021 AND 2020~~Credit

AtThe ~~October~~Coronavirus 31Aid, ~~2021~~Relief and ~~2020,~~Economic ~~the~~Securities Act ~~Company~~(“CARES ~~did not~~Act”) ~~have~~provides ~~any~~for ~~unrecognized~~an ~~income~~employee retention credit (“ERC”) that is a refundable tax ~~benefits.~~credit ~~There~~against ~~were~~certain employer notaxes. ~~changes~~On inDecember 27, 2020, the ~~balance~~Taxpayer Certainty and Disaster Tax Relief Act of ~~unrecognized~~2020, ~~income~~expanded ~~tax~~certain benefits inmade available ~~fiscal~~under ~~2021~~ the CARES Act, including modifying and ~~fiscal~~extending ~~2020~~the ERC. AtAs ~~October 31~~modified, ~~2021,~~ the ~~Company~~ERC ~~did~~provides ~~not~~eligible ~~expect~~employers ~~any~~with ~~changes~~less inthan 500 ~~unrecognized~~employees ~~income~~a refundable tax ~~benefits~~credit ~~during~~against the ~~next~~employer’s ~~twelve months.~~share Inof ~~fiscal~~social ~~2021~~security ~~and~~taxes. ~~fiscal~~The ~~2020,~~ERC ~~the~~is ~~Company~~equal ~~did~~to ~~not~~70% ~~record~~of ~~any~~qualified wages ~~interest~~paid ~~and~~to ~~penalties~~employees onduring ~~income~~calendar ~~taxes.~~2021 Atfor ~~October~~a ~~31,~~maximum ~~2021~~credit ~~and 2020,~~per ~~there~~employee ~~was~~of no$7,000 per ~~accrued~~employee ~~interest~~for ~~included~~each incalendar ~~current~~quarter ~~income~~through December ~~taxes~~31, ~~payable~~2021.

The Company ~~currently~~qualifies ~~remains~~for ~~subject~~the totax ~~examinations~~credit under the CARES Act. During the fiscal year ended October 31, 2022, the Company recognized an ERC for qualified wages paid between January 1, 2021 and March 31, 2021 of ~~its~~$564,000 as an offset to payroll tax ~~returns~~expenses aswithin ~~follows:~~selling, Ugeneral and administrative expenses in the Company’s consolidated statements of operations.S. ~~federal~~The ~~tax~~Company ~~returns~~received ~~for~~$128,000 ~~fiscal~~of ~~2018~~the torefund in cash in the third quarter of fiscal 2022. ~~2021~~As of October 31, ~~state~~2022, ~~and~~the ~~local~~Company ~~tax~~has ~~returns~~a ~~generally~~$436,000 receivable balance for ~~fiscal~~unsettled ERCs within prepaid expenses and other current ~~2018~~assets toon ~~fiscal~~its ~~2021~~consolidated balance sheet.

~~Note~~We ~~16—~~accounted ~~Deconsolidation~~for the employee retention credit by analogy to International Accounting Standards (“IAS”) 20, Accounting for Government Grants and Disclosure of ~~Subsidiary~~Government Assistance, of International Financial Reporting Standards (IFRS). Under an IAS 20 analogy, a business entity would recognize the credit on a systematic basis over the periods in which the entity recognizes the payroll expenses for which the grant/ tax credit is intended to compensate when there is reasonable assurance, and it is probable that the entity will comply with any conditions attached to the grant and the grant/tax credit will be received.

a. Effective April 1, 2020, the Company’s interest in Clover Press decreased to 19.9% and IDWMH no longer consolidates the operations of Clover Press. Accordingly, the Company derecognized related assets, liabilities and noncontrolling interests of Clover Press.F-26

b.Note ~~Analysis~~16—Discontinued ofOperations ~~assets and liabilities over which the Company lost control~~

(in thousands)	March 31, 2020
Current assets
Cash and cash equivalents	$	215
Trade accounts receivable		1
Inventory		62
Other current assets		9
Noncurrent assets
Intangible assets, net		10
Right-of-use assets		226
Other noncurrent assets		64
Current liabilities
Trade accounts payable		(38	)
Operating lease obligation- current		(64	)
Related party notes payable		(50	)
Non-current liabilities
Operating lease obligations -long term		(169	)
Net assets deconsolidated	$	266

c. Loss on deconsolidation of subsidiary

(in thousands)	Fiscal Year Ended October 31, 2020
Fair value of interest retained	$	25
Consideration received		100
Carrying amount of interest retained:
Net assets deconsolidated		(266	)
Noncontrolling interests		106
Loss on deconsolidation of subsidiary	$	(35	)

F-29

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Loss on deconsolidation of subsidiary was included in other expenses. The technique used to measure fair value was calculating the net present value of future EBITDA projected over five years. The transaction was not with a related party. The continuing involvement consists of 19.9% ownership and an officer of IDWMH has one of three seats on the board.

d. Net cash outflow arising from deconsolidation of the subsidiary

(in thousands)		Fiscal Year Ended October 31, 2020
The balance of cash and cash equivalents deconsolidated		$	(115	)

Note 17- Discontinued Operations

As a result of the economic downturn related to the outbreak of the COVID-19 virus, and the impact it had on small businesses in the tourist markets, the Company decided to make a strategic shift to dispose of CTM and to focus on its entertainment and publishing businesses.

On February 15, 2021, pursuant to a sales and purchase agreement (“SPA”) dated as of July 14, 2020 IDWMH sold all of the stock of CTM to an assignee of the Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness owed by IDWMH to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date (which condition was not met), and (iii) a contingent payment if CTM is sold within 36 months of the CTM Sale Date for more than $4.5 million. As of October 31, 2022, the 18-month period for the contingent payment based upon recovery of quarterly revenue has lapsed and no payment is owed. Prior to executing the SPA, the Company obtained a third-party’s valuation of CTM and a fairness opinion that stated the consideration being received by the Company in the CTM Sale was fair. In addition to the Company’s Board of Directors approving the CTM Sale, the Audit Committee of the Board of Directors, which is comprised entirely of independent directors, approved the CTM Sale in compliance with the Company’s Statement of Policy with respect to Related Person Transactions. The CTM Sale was also approved by (1) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock and (2) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock not held by the Chairman or immediate family members of the Chairman, including, without limitation, trusts or other vehicles for the benefit of any of such immediate family members or entities under the control of such persons. On December 15, 2020, the right, title, and interest to the SPA were assigned to The Brochure Distribution Trust, a South Dakota trust. ~~The~~ Since the closing of the CTM Sale, the Company ~~does~~ has not ~~expect~~had ~~to have~~any significant continuing involvement with CTM ~~after the sale closes~~.

As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the consolidated financial statements as discontinued operations. On February 15, 2021, the Company closed the CTM Sale. The loan of $3,750,000 was forgiven in part of the sale and the Company recorded a gain of $2,123,219 based on CTM’s net asset value as of the CTM Sale Date. CTM’s assets are no longer reflected on the consolidated financial statements for the periods following the CTM Sale Date and CTM’s operations are only consolidated in the Company’s consolidated statements of operations results until the CTM Sale Date. There was no contingent gain recorded since there was no foreseeable contingent payments to the Company.

Pursuant to ASC 205-20-45-9 general corporate overhead should not be allocated to discontinued operations. The Company did not allocate any corporate overhead to CTM when it began being classified as held for sale in the third quarter of 2020 and continued to not allocate any expenses.

F-30

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

The consolidated statements of operations include the following results related to CTM discontinued operations:

Results of discontinued operations	~~Fiscal year ended, October 31,~~
(in thousands)	Fiscal year ended, October 31, 2021			~~2020~~
Revenue	$	1,427		$	~~9,264~~
Direct cost of revenue		946			~~4,480~~
Selling, general and administrative		1,650			~~7,413~~
Depreciation and amortization		295			~~1,175~~
Bad Debt		(109	)		~~680~~
Total costs and expenses		2,782			~~13,748~~
Loss from operations		(1,355	)		~~(4,484~~	)
Interest expense, net		6			~~(78~~	)
Other income (expense), net		68			~~452~~
Loss before income taxes		(1,281	)		~~(4,110~~	)
(Provision for) benefit from income taxes		-			-
Net loss	$	(1,281	)	$	~~(4,110~~	)

~~(i) Stock based compensation for discontinued operations included in selling, general and administrative expenses is $0 in the fiscal years ended October 31, 2021 and 2020, respectively.~~F-27

~~(ii)~~ CTM’s isdepreciation noand ~~longer~~amortization, ~~consolidated~~capital ~~into~~expenditures ~~the~~and notable ~~Company~~activities asfor ~~of February 15, 2021~~ the ~~CTM~~discontinued ~~Sale~~operation ~~Date.~~include:

Cash flows of CTM’s depreciation and amortization, capital expenditures and notable activities for the discontinued operation include:

(in thousands)	Fiscal year ended, October 31, 2021
Depreciation and amortization	$	188
Amortization of finance lease		108
Amortization of right-of-use assets		282
Capital expenditure		(22	)
Gain on extinguishment of PPP loan		(68	)

(in thousands)	October 31, 2021			October 31, 2020
Depreciation and amortization	$	188		$	764
Amortization of finance lease		108			411
Amortization of right-of-use assets		282			1,329
Capital expenditure		(22	)		(381	)
Gain on extinguishment of PPP loan		(68	)		-

During the fiscal year ended October 31, 2022, there was no activity in the consolidated statement of operations and consolidated statement of cash flows related to CTM.

~~Significant~~Note ~~cash~~17—Labor ~~flow transactions recorded on IDWMH as a result of the sale of discontinued operations include:~~Agreements

● Gain on sale of CTM of $2,123,000

● Gain on disposal of ROU assets of $97,000

● Disposal of discontinued operations of ($902,000)

F-31

IDW MEDIA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

The accompanying consolidated balance sheets include the following carrying amounts of assets and liabilities related to the CTM discontinued operations:

Assets and liabilities of Discontinued Operations	October 31,
(in thousands)	2021		2020
Assets
Cash	$	-	$	1,621
Trade receivables, net		-		844
Prepaid expenses		-		368
Total current assets*		-
Property and equipment, net		-		1,274
Right-of-use assets, net		-		4,649
Intangible assets, net		-		142
Goodwill		-		2,110
Other assets		-		163
Total Assets	$	-	$	11,171
Liabilities
Trade accounts payable		-		891
Accrued expenses		-		368
Deferred revenue		-		664
Government loan- current portion		-		1,125
Operating lease obligations-current portion		-		909
Finance lease obligations- current portion		-		342
Income taxes payable and other current liabilities		-		71
Total current liabilities*		-
Government loan- long term portion		-		684
Operating lease obligations – long term portion		-		3,034
Finance lease obligations – long term portion		-		452
Total non-current liabilities*		-
Total Liabilities	$	-	$	8,540

* The assets and liabilities of the disposal group classified as held for sale are all classified as current on Assets and Liabilities of Discontinued Operations since it’s probable the sale will occur, and proceeds will be collected within one year. Therefore, no sub totals

between current and non-current have been displayed. Since the sale of the discontinued operations the assets and liabilities are no longer reflected above.

Note 18—Labor Agreements

IDWE produces its television shows utilizing primarily union-based employees, whether through SPEs or through independent production companies. Those unions represent employees that are subject to collective bargaining agreements and IDWE’s costs and scheduling of production are subject to those agreements.

~~F-32~~Note 18—Related Party Transactions

~~IDW~~In ~~MEDIA~~conjunction ~~HOLDINGS~~with two loans made by the Chairman to the Company, ~~INC~~which have been subsequently repaid, the Company issued the Chairman warrants to purchase up to 98,336 and 89,243 shares of the Company’s Class B common stock at a price of $26.44 and $42.02, respectively, with an original expiration date of March 30, 2022 and August 21, 2023, respectively. On March 29, 2022, the exercise price of these warrants was amended to $1.94 and the expiration date for the 98,336 was amended to August 21, 2023. No additional compensation cost was incurred from the modification.

~~NOTES~~On TOFebruary ~~CONSOLIDATED~~15, ~~FINANCIAL~~2021, ~~STATEMENTS~~pursuant to a SPA dated as of July 14, 2020, IDWMH sold all of the stock of CTM to an assignee of the Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness owed by IDWMH to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date (which condition was not met), and (iii) a contingent payment if CTM is sold within 36 months the CTM Sale Date for more than $4.5 million. As of October 31, 2022, the 18-month period for the contingent payment based upon recovery of quarterly revenue has lapsed and no payment is owed. Prior to executing the SPA, the Company obtained a third-party’s valuation of CTM and a fairness opinion that stated the consideration being received by the Company in the CTM Sale was fair. In addition to the Company’s Board of Directors approving the CTM Sale, the Audit Committee of the Board of Directors, which is comprised entirely of independent directors, approved the CTM Sale in compliance with the Company’s Statement of Policy with respect to Related Person Transactions. The CTM Sale was also approved by (1) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock and (2) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock not held by the Chairman or immediate family members of the Chairman, including, without limitation, trusts or other vehicles for the benefit of any of such immediate family members or entities under the control of such persons. On December 15, 2020, the right, title, and interest to the SPA were assigned to The Brochure Distribution Trust, a South Dakota trust. Since the closing of the CTM Sale, the Company has not had any significant continuing involvement with CTM.

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

Note 19—Related Party Transactions

On August 21, 2018, the Company entered into a loan agreement with the Company’s Chairman of the Board of Directors (who, at the time, was also the Company’s Chief Executive Officer and majority stockholder) (the “Chairman”) for $5,000,000. Interest accrues at prime rate plus 1% and the loan matures August 20, 2022. Payment of principal and interest are payable from 70% of the Free Cash Flow, as defined in the loan agreement, of the Company’s CTM Media Group Inc. subsidiary. All outstanding shares of CTM Media Group Inc. stock are pledged as security under the agreement. On December 1, 2019, the Company amended the agreement providing that up to 60% of the interest due may, at the option of the Company, be paid in shares of Class B common stock (and the remaining amount in cash) with such shares valued based on the average closing prices for the Class B common stock on the ten trading days immediately prior to the applicable interest due date. As at October 31, 2020 the shares issued in connection with the loan interest was 56,545. The interest is to be paid quarterly on the loan. In conjunction with the loan, the Company issued the Chairman a warrant to purchase up to 89,243 shares of the Company’s Class B Common Stock at a price per share of $42.02. The warrant expires August 21, 2023. On July 13, 2020 $1,250,000 was converted into 314,070 shares of Class B Common Stock (Note 5). On February 15, 2021 the Company closed the previously announced CTM Sale and since the loan balance equaled the purchase price, the Company wrote down the loan of $3,750,000. The outstanding amount was $0 and $3,750,000 at October 31, 2021 and 2020, respectively.

For the fiscal year ended October 31, 2021, interest on the above loan and the related party bridge loan amounted to $41,000 and for the fiscal year October 31, 2020 interest amounted to $406,000, which was charged to production cost.

On February 15, 2021, pursuant to a SPA dated as of July 14, 2020 IDWMH sold all of the stock of CTM to an assignee of the Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness owed by IDWMH to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date, and (iii) a contingent payment if CTM is sold within 36 months the CTM Sale Date for more than $4.5 million. Prior to executing the SPA, the Company obtained a third-party’s valuation of CTM and a fairness opinion that stated the consideration being received by the Company in the CTM Sale was fair. In addition to the Company’s Board of Directors approving the CTM Sale, the Audit Committee of the Board of Directors, which is comprised entirely of independent directors, approved the CTM Sale in compliance with the Company’s Statement of Policy with respect to Related Person Transactions. The CTM Sale was also approved by (1) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock and (2) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock not held by the Chairman or immediate family members of the Chairman, including, without limitation, trusts or other vehicles for the benefit of any of such immediate family members or entities under the control of such persons. On December 15, 2020, the right, title and interest to the SPA were assigned to The Brochure Distribution Trust, a South Dakota trust. The Company does not expect to have significant continuing involvement with CTM after the sale closes.

~~Note~~The ~~20—Defined~~Company ~~Contribution~~obtained ~~Plans~~its insurance coverage from ARC Excess & Surplus, LLC (“ARC”) in which Mason and Company Consulting, LLC (“Mason and Co.”) acted as the outside independent broker. Mason and Co. is owned by a family member of the Company’s Chairman and principal stockholder. The Company paid ARC for the insurance coverage and Mason and Co. received a commission from ARC in the amount of $36,000 in fiscal 2022.

The Company ~~has~~leases aoffice ~~401(k)~~space ~~Plan~~and ~~that~~receives ~~are~~consulting ~~available~~services tofrom ~~all~~an ~~its~~affiliate ~~employees~~of ~~meeting~~the ~~certain~~Company’s ~~eligibility~~Chairman ~~criteria~~and principal stockholder. The ~~401(k)~~Company ~~Plan~~incurred ~~permits~~$47,000 ~~participants~~and to$71,000 ~~contribute a portion~~ of expenses ~~their~~for ~~salary~~these ~~with~~services noin ~~minimum~~the ~~deferred~~fiscal ~~required,~~years ~~not~~ended toOctober ~~exceed~~31, ~~the~~2022 ~~limits~~and ~~established~~2021, ~~by the Internal Revenue Code~~respectively. ~~The~~As ~~Plan~~of ~~provides for~~October ~~discretionary~~31, ~~matching~~2022 ~~contributions~~and as2021, ~~determined in~~ the Company’s ~~sole~~was owed ~~discretion~~$7,000 ~~which~~and ~~vest either immediately or over six years~~$18,000 ~~depending~~by ~~upon~~ the ~~specific~~affiliate, ~~plan’s documents~~respectively. ~~All contributions made by participants vest immediately into the participant’s account.~~

~~The Company also has a 401(k) matching plan whereby the Company matches a percentage of employee 401(k) contributions, based on maximum employee deferral rates of calendar year W~~F-2 compensation, as defined in the plans. Funds are added to accounts of employees that are actively employed in a given calendar year, as defined. Although the Company is fully committed to the plans, the company’s match and the terms of the match are subject to cancellation and/or change, at any time, without notice.28

~~F-33~~Note 19—Defined Contribution Plans

~~IDW~~The ~~MEDIA~~Company ~~HOLDINGS~~has a 401(k) Plan that is available to all its employees meeting certain eligibility criteria. The 401(k) Plan permits participants to contribute a portion of their salary with no minimum deferred required, ~~INC~~not to exceed the limits established by the Internal Revenue Code. All contributions made by participants vest immediately into the participant’s account. The Plan provides for safe harbor matching contributions, which vest immediately, whereby the Company matches a percentage of employee 401(k) contributions, based on maximum employee deferral rates of calendar year W-2 compensation, as defined in the plans. Funds are added to accounts of employees that are actively employed in a given calendar year, as defined. The company’s match is subject to change at the company’s discretion on a yearly basis.

~~NOTES~~The TOCompany ~~CONSOLIDATED~~contributed approximately ~~FINANCIAL~~$228,000 and ~~STATEMENTS~~$117,000 for the fiscal years ended October 31, 2022 and 2021, respectively.

FOR THE FISCAL YEARS ENDED OCTOBER 31, 2021 AND 2020

The Company contributed approximately $117,000 and $54,000 for the fiscal years ended October 31, 2021 and 2020, respectively.

For union contractors, the company contributes to multiemployer pension plans jointly administered by industry and union representatives. The risk of participating in U.S. multiemployer pension plans is different from single employer pension plans in the following aspects:

Assets contributed to the multiemployer plan by one employer may be used to provide benefits of employment to other participating employers.

If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.

If the Company stops participating in some of its multiemployer pension plans, it may be required to pay those plans an amount based on the underfunded status of the entire plan, referred to as a withdrawal liability.

The Company’s participation in these ~~plans~~ plans for the fiscal years ended October 31, ~~2021~~2022 and October 31, ~~2020~~2021 is outlined in the following table. The latest information provided by the multi-employer plan is for the plan year ~~2019~~2021 from January 1,~~2019~~ 2021 to December 31, ~~2019~~2021. The Plan Protection Act (“PPA”) zone status column ranks the funded status of multiemployer pension plans depending upon a plan’s current and projected funding. The zone status is based on information that the Company received from the plan. Among other factors, the plan is in the Red Zone (Critical) if it has a current funded percentage less than 65%. A plan is in the Yellow Zone (Endangered) or Orange Zone (Seriously Endangered) if it has a current funded percentage of less than 80%, or projects a credit balance deficit within seven years. A plan is in the Green Zone (Healthy) if it has a current funded percentage greater than 80% and does not have a projected credit balance deficit within seven years. The Funding Improvement Plan (“FIP”)/Rehabilitation Plan (“RP”) status column indicates plans for which a FIP or RP is either pending or in place. ~~The following table contains information about the Company’s multiemployer pension plans for the fiscal years ended October 31, 2021 and 2020:~~

The following table contains information about the Company’s multiemployer pension plans for the fiscal years ended October 31, ~~2021~~2022 and ~~2020~~2021.

Producer-Writer Guild of America		Pension Plan
Producer-Writer Guild of America Pension Plan
Expiration date of Collective Bargaining Agreement		NA
Employer Identification Number		95-2216351
Plan Number		001
PPA Status 2021		NA
PPA Status 2022		NA
PPA Status 2020		NA
PPA Status 2021		Green
FIP/RP Status Pending/Implemented		NA
Company’s Contributions 2021		$26,704
Company’s Contributions 2022		$37,411
Company’s Contribution 2020		$18,555
Company’s Contribution 2021		$26,704
Center Contributions > 5% 2021		NA
Company Contributions > 5% 2022		NA
Center Contributions > 5% 2020		NA
Company Contributions > 5% 2021		No
Plan’s year-end		Dec 31/~~2019~~2021

The Company currently has no intention of withdrawing from any of the multiemployer pension plans in which they participate.

Note 2120— Subsequent events

The Company has evaluated subsequent events through January 2019, ~~2022~~2023, the date on which the consolidated financial statements were available to be issued. There were no material subsequent events that require recognition or additional disclosures in these consolidated financial statements~~, except as follows:~~.

~~On December 3, 2021, the Company’s Vice Chairman was issued 648,222 of options to purchase shares of the Company’s common stock with an exercise price of $2.43 per share. The options have a 10~~F-~~year term with vesting over a 4-year period.~~29

F-34

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0.01 0.01 Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life of the asset. IDWE includes Thought Bubble LLC and Word Balloon LLC which consist of only television costs. IDWP includes Clover Press through March 31, 2020. As of April 1, 2020, Clover Press was valued at the cost method and was no longer consolidated. The assets and liabilities of the disposal group classified as held for sale are all classified as current on Assets and Liabilities of Discontinued Operations since it’s probable the sale will occur, and proceeds will be collected within one year. Therefore, no sub totals between current and non-current have been displayed. 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