# EDGAR Filing Document

**Accession Number:** 0000875355
**File Stem:** 0001654954-23-002427
**Filing Date:** 2023-3
**Character Count:** 15427
**Document Hash:** eb9094632a9bd7c21e3b8478b9ce6979
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001654954-23-002427.hdr.sgml**: 20230306

**ACCESSION NUMBER**: 0001654954-23-002427

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 16

**CONFORMED PERIOD OF REPORT**: 20230306

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230306

**DATE AS OF CHANGE**: 20230306

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** INSIGNIA SYSTEMS INC/MN
- **CENTRAL INDEX KEY:** 0000875355
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-ADVERTISING [7310]
- **IRS NUMBER:** 411656308
- **STATE OF INCORPORATION:** MN
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-13471
- **FILM NUMBER:** 23709027

**BUSINESS ADDRESS:**
- **STREET 1:** 212 THIRD AVE N
- **STREET 2:** STE 356
- **CITY:** MINNEAPOLIS
- **STATE:** MN
- **ZIP:** 55401
- **BUSINESS PHONE:** 7633926200

**MAIL ADDRESS:**
- **STREET 1:** 212 THIRD AVE N
- **STREET 2:** STE 356
- **CITY:** MINNEAPOLIS
- **STATE:** MN
- **ZIP:** 55401

?xml version="1.0" encoding="utf-8"?isig_8k.htm

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON D.C. 20549**

**FORM 8-K**

**CURRENT REPORT** 

**PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**March 6, 2023**

Date of Report (Date of Earliest Event Reported)

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| |
|:---|
| **Insignia Systems Inc/MN** |
| (Exact Name of Registrant as Specified in its Charter) |

---

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| | | |
|:---|:---|:---|
| **Minnesota** | **001-13471** | **41-1656308** |
| (State of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |

---

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| | |
|:---|:---|
| **212 Third Avenue N, Suite 356** <br>**Minneapolis, Minnesota** | **55401** |
| (Address of Principal Executive Offices) | (Zip Code) |

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**(763) 392-6200**

(Registrant's Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

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| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol | Name of each exchange on which registered |
| **Common Stock, par value $0.01 per share** | **ISIG** | **The Nasdaq Stock Market LLC** |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter):

☐ 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. ☐

**Item 2.02. Results of Operations and Financial Condition.**

On March 6, 2023, Insignia Systems, Inc. issued a press release announcing the Company's fourth quarter and full year 2022 financial results.

A copy of the press release issued by the company is furnished as Exhibit 99.1 attached hereto and is incorporated herein by reference.

The information contained in this Current Report is furnished and not deemed to be filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information in this Current Report shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

**Item 9.01. Financial Statements and Exhibits.**

*(d) Exhibits.*

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| | | |
|:---|:---|:---|
| **Exhibit No.** | **Description** | **Method of Filing** |
| [99.1](isig_ex991.htm) | [Press Release, dated March 6, 2023](isig_ex991.htm) | Filed Electronically |

---

2<br>

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Current Report to be signed on its behalf by the undersigned hereunto duly authorized.

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| | |
|:---|:---|
|  | INSIGNIA SYSTEMS, INC. |
| Dated: March 6, 2023 | /s/ Zackery A. Weber |
|  | Zackery A. Weber |
|  | Vice President of Finance |
|  | (principal accounting officer) |

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3<br>

## Exhibit 99.1

&nbsp;&nbsp;&nbsp;&nbsp;**EXHIBIT 99.1**

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| | |
|:---|:---|
| **Contact:**<br>Insignia Systems, Inc.<br> Kristine Glancy, CEO<br> (763) 392-6200 | ![](isig_ex991img4.jpg)  |

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**<u>FOR IMMEDIATE RELEASE</u>**

**INSIGNIA SYSTEMS, INC. ANNOUNCES**

**FOURTH QUARTER AND FULL YEAR 2022 FINANCIAL RESULTS**

**MINNEAPOLIS, MN** – **March 6, 2023** – **Insignia Systems, Inc. (Nasdaq: ISIG) ("Insignia")** today reported financial results for the fourth quarter ("Q4") and the full year ended December 31, 2022.

**<u>Overview</u>**

· Q4 2022 net sales were $4.5 million, compared to $4.5 million in Q4 2021.

· Q4 2022 operating loss was $905,000 compared to operating loss of $1.3 million in Q4 2021.

· Q4 2022 net loss was $733,000, or $0.41 per basic and diluted share, compared to net loss of $1.0 million, or $0.56 per basic and diluted share in Q4 2021.

· 2022 net sales were $18.8 million, a decrease of 3.6% from $19.5 million in 2021.

· 2022 operating income was $9.6 million (including litigation settlement proceeds of $12 million) compared to operating loss of $4.8 million in 2021.

· 2022 net income was $10.0 million, or $5.61 per basic and $5.59 per diluted share, compared to net loss of $3.5 million, or $2.01 per basic and diluted share in 2021.

Insignia's President and CEO, Kristine Glancy, commented, "2022 was a successful year for our organization. Building off of our new branding, we continued to pivot our overall business proposition with our clients, which drove increased engagement and the highest rates of client retention we have had on our display and on-pack businesses. We focused on maintaining our critical functional headcount in order to support the continued growth of display and on-pack while also adding additional support in areas such as design and fulfillment. We expanded our client base with new brands, increasing our overall reach in the marketplace. While our overall revenue decreased 3.6% versus 2021, our non-signage revenue increased 21.5% versus 2021, with continued growth expected. Our signage business revenue decreased 81.5%, reflecting our deliberate effort to minimize further investments in that business, accompanied by overall retail contraction of our network and decreased demand. We also reached a settlement of our litigation in July 2022 which delivered approximately $12 million for our organization."

Ms. Glancy continued, "As we move forward into 2023, we plan to continue our focus on building our higher potential businesses both more efficiently and profitably. We have nearly replaced our signage revenue with display and on-pack revenue in an extremely short amount of time. We know we have opportunities to further streamline our processes internally for our team to work more efficiently and effectively and identify areas for improved profitability. We have identified areas that require continued investment and will continue to prioritize both our display and on-pack businesses while winding down our POPS signage business by the end of 2023. We are optimistic about how 2023 has started, securing several new and large display contracts and expect the first part of 2023 to show significant growth."

As previously announced, Insignia continues to explore strategic options to maximize shareholder value. Potential strategic alternatives that may be evaluated include, but are not limited to, an acquisition, merger, business combination, in-licensing, start-up of new business, or other strategic initiatives. There can be no assurance that this process will result in any transaction or other initiatives, and the Company has no updates at this stage. Chardan has been engaged to act as Insignia Systems' strategic financial advisor to assist the Company in this review process.

**<u>Q4 2022 Results</u>**

Net sales were $4,529,000 in Q4 2022, compared to $4,528,000 in Q4 2021.

Gross profit in Q4 2022 increased to $767,000, or 16.9% of net sales, from $548,000, or 12.1% of net sales, in Q4 2021. The increase in gross profit was primarily due reduced staff and staff related expense, in addition to improved margin rates on non-POPS net sales.

Selling expenses in Q4 2022 were $399,000, or 8.8% of net sales, compared to $525,000, or 11.6% of net sales, in Q4 2021 due to decreased staff and staff related expense.

Marketing expenses in Q4 2022 were $263,000, or 5.8% of net sales, compared to $271,000, or 6.0% of net sales, in Q4 2021.

General and administrative expenses in Q4 2022 were $1,010,000, or 22.3% of net sales, compared to $1,006,000, or 22.2% of net sales, in Q4 2021. Increased expenses relating to the strategic alternatives process were substantially offset by decreased litigation expenses.

Other income in Q4 2022 was $122,000 compared to $282,000 in Q4 2021. The decrease in other income was primarily the result of a $273,000 benefit under the Employee Retention Credit recorded in the fourth quarter of 2021 that did not reoccur in 2022.

Income tax benefit for Q4 2022 was 6.4% of pretax loss, or a benefit of $50,000, compared to income tax expense of 1.0% of pretax loss or $10,000, in Q4 2021.

As a result of the items above, the net loss for Q4 2022 was $733,000, or $0.41 per basic and diluted share, compared to a net loss of $982,000, or $0.56 per basic and diluted share, in Q4 2021.

As of December 31, 2022, cash and cash equivalents and restricted cash totaled $14.5 million, compared to $3.9 million as of December 31, 2021.

**<u>About Insignia Systems, Inc.</u>**

Insignia Systems, Inc. is a leading provider of in-store solutions to consumer-packaged goods ("CPG") manufacturers, retailers, shopper marketing agencies and brokerages. The Company's primary solutions are merchandising solutions, on-pack solutions and signage.

For additional information, contact (800) 874-4648, or visit the Insignia website at www.insigniasystems.com

Investor inquiries can be submitted to investorrelations@insigniasystems.com.

**Cautionary Statement for the Purpose of Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995**

Statements in this press release that are not statements of historical or current facts are considered forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. The words "anticipate," "continue," "expect," "intend," "plan," "remain," "seek," "will" and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these or any forward-looking statements, which speak only as of the date of this press release. Statements made in this press release regarding, for instance, the ongoing exploration of strategic alternatives, anticipated future profitability, future revenues, innovation and transformation of Insignia's business, allocations of resources, and the benefits of new relationships, are forward-looking statements. These forward-looking statements are based on current information, which we have assessed and which by its nature is dynamic and subject to rapid and even abrupt changes. As such, actual results may differ materially from the results or performance expressed or implied by such forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including those set forth in our Annual Report on Form 10-K for the year ended December 31, 2021 and additional risks, if any, identified in our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K filed with the SEC. Such forward-looking statements should be read in conjunction with Insignia's filings with the SEC. Insignia assumes no responsibility to update the forward-looking statements contained in this press release or the reasons why actual results would differ from those anticipated in any such forward-looking statement, other than as required by law.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Insignia Systems, Inc.** | **Insignia Systems, Inc.** | **Insignia Systems, Inc.** | **Insignia Systems, Inc.** | **Insignia Systems, Inc.** |
| **STATEMENTS OF OPERATIONS** | **STATEMENTS OF OPERATIONS** | **STATEMENTS OF OPERATIONS** | **STATEMENTS OF OPERATIONS** | **STATEMENTS OF OPERATIONS** |
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) |
|  | Three Months Ended | Three Months Ended | Year Ended | Year Ended |
|  | December 31, | December 31, | December 31, | December 31, |
|  | 2022 | 2021 | 2022 | 2021 |
| Service revenues | $4529000 | $4528000 | $18800000 | $19503000 |
| Cost of services | 3762000 | 3980000 | 15499000 | 16273000 |
| Gross profit | 767000 | 548000 | 3301000 | 3230000 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Selling | 399000 | 525000 | 1325000 | 1931000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Marketing | 263000 | 271000 | 1050000 | 1032000 |
| &nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 1010000 | 1006000 | 3320000 | 5058000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 1672000 | 1802000 | 5695000 | 8021000 |
| Gain from litigation settlement, net |  |  | 12000000 |  |
| Operating income (loss) | (905000) | (1254000) | 9606000 | (4791000) |
| Other income (expense), net | 122000 | 282000 | 222000 | 1299000 |
| Income (loss) before taxes | (783000) | (972000) | 9828000 | (3492000) |
| Income tax expense (benefit) | (50000) | 10000 | (218000) | 42000 |
| Net income (loss) | $(733000) | $(982000) | $10046000 | $(3534000) |
| Net income (loss) per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | $(0.41) | $(0.56) | $5.61 | $(2.01) |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | $(0.41) | $(0.56) | $5.59 | $(2.01) |
| Shares used in calculation of net income (loss) per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | 1797000 | 1770000 | 1791000 | 1760000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | 1797000 | 1770000 | 1796000 | 1760000 |

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| | | |
|:---|:---|:---|
| **SELECTED BALANCE SHEET DATA** | **SELECTED BALANCE SHEET DATA** | **SELECTED BALANCE SHEET DATA** |
| (Unaudited) | (Unaudited) | (Unaudited) |
|  | December 31, | December 31, |
|  | 2022 | 2021 |
| Cash and cash equivalents | $14524000 | $3851000 |
| Working capital | 13379000 | 3716000 |
| Total assets | 20968000 | 10650000 |
| Total liabilities | 7567000 | 7457000 |
| Shareholders' equity | 13401000 | 3193000 |
| Working capital represents current assets less current liabilities. |  |  |

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