And as Andy mentioned, Ward and Amy are also here for what we think will be an informative Q&A session. Since my arrival, among my highest priorities is focusing on our people and our leadership team. Having the right people in the right positions is absolutely vital to our future success. And that's why I'm delighted to announce the promotions of three of our senior leaders, Amy Lessinger, Abby Lee, and Susie Winders. Amy is a passionate member of the RE/MAX organization for over 25 years as an agent, a team leader, a franchise owner, and now a member of our executive leadership team. She's being promoted to President of RE/MAX, LLC where she will lead the RE/MAX brand and network. She succeeds Nick Bailey who is leaving the company. Abby Lee is being promoted to Executive Vice President of Marketing, Communications, and Events.

She will continue to lead advertising, marketing, communications, and public relations, in addition to now managing the company's events team. And Susie Winders is being promoted to Executive Vice President, General Counsel, Chief Compliance Officer, and Secretary. Amy, Abby, and Susie will all report directly to me. But these are well-deserved and positive changes that I believe will help us navigate the road ahead and realize our full potential. During my first 100 days, I spent a considerable amount of time listening, learning, and leading, meeting with hundreds of stakeholders. I met a lot of great people and heard a lot of innovative ideas, which I know we can leverage. It's been a bit of a drinking from a fire hose sort of experience, immersing myself into our business, covering everything from high-level strategy to the details of various processes, systems, and structures.

During these conversations, I'm often asked, Erik, what attracted you to the company? Why did you take this job? Well, initially, I was drawn by the company's purpose, helping people realize their dream of home ownership. For many of us buying or selling a home is almost one of the most important decisions that we make and one of the most joyful days that we'll experience in our lifetime. Also, I was equally energized about joining the company because of what I knew about RE/MAX, an iconic brand that's number one worldwide in residential real estate size. RE/MAX has a brand people know, an unmatched global presence, a unique value proposition of services and competitive advantages, and most importantly, the most dynamic, most productive, and most trusted agents and brokers in the business.

Known for being skilled, experienced, and very good at what they do, RE/MAX agents have made RE/MAX the world's most productive real estate network. And in the U.S. and Canada, consumers have voted them the most trusted agents for several years straight. Look, RE/MAX agents are simply the gold standard. The original RE/MAX business model, which gives entrepreneurs a way to maximize their careers, is still thriving around the globe. Over 140,000 RE/MAX agents in more than 110 countries and territories deliver positive outcomes to buyers and sellers every single day. And we believe RE/MAX still has a lot of room to grow. I'm also enthusiastic about the mortgage side of our business. Both Motto and wemlo have unique product offerings that have shown great promise in the marketplace.

With better end market conditions and a continued focus and effort, we have confidence that, with time, our mortgage segment can grow into a meaningful revenue business. The bottom line, I'm here because I believe I can make a difference. While we're motivated by and confident in our competitive advantages and those enticing potential growth opportunities, we are acutely aware of what we need to do to improve our performance. Two of our top priorities in the playbook are clear. We need to stabilize and grow U.S. agent counts and expand the mortgage business. Posting gains in those two areas would build market share, increase revenue and earnings. Each will create momentum for additional growth. Now it won't be easy, but we know how important those two objectives are in both the short and the long term.

The better news from what we saw in 2023 is encouraging interest rate trends. Improving customer sentiment and ongoing pent-up demand bode well for progressively better housing market performance moving forward, one that should get incrementally better as the year goes on. As it relates to our business, our team continues to see plenty of opportunities. Throughout my career, I've been focused on continually improving the customer experience, delivering distinctive products and services that meet customers' needs, diversified financial performance and leveraging best-in-class capabilities that enable teams to win. Utilizing my sales, marketing, operations, and leadership background, our playbook will concentrate on operating our business as effectively and efficiently as possible, having a growth mindset and focusing on delivering the absolute best customer service.

We've got a great foundation to build on. Our team, our affiliates, they're passionate about our brand, about each other and about innovating, growing and simply getting better each and every day. Since mid-November, we've spent time assessing what programs to accelerate, what programs to expand and which to discontinue. This allows us to be more effective and will enhance our ability to fast-track programs that make a difference and that's why we believe our current strategic growth initiatives provide us with the best opportunity for improved performance this year and build on the foundation for the long term. We continue to see measurable progress and positive results from our programs. Current market conditions have certainly overshadowed the desired results.

However, we're eager to see how our initiatives perform in an improving market, and we are optimistic that we can deliver better outcomes. When our growth programs were announced in mid-2022, the team knew the conversions, mergers and acquisitions for CM&A and a team's effort in particular, would require some time to communicate, to gain traction and to build momentum and that's proven to be the case. Now when we look back at the original cohort of brokerages that joined us in 2022 via the CM&A program, our one-year returns were in line with expectations and the number of completed transactions more than doubled year-over-year in 2023. On a team front, the original pilot program launched in 2022 -- was expanded last summer in a modified version and has continued to help broker, owners bring more agents and teams into the network, while incentivizing smaller teams to grow.

As a result of the program's impact and our lessons learned, we're expanding the modified version of the program to encourage team recruitment and growth across much of the U.S. You know, from our perspective, this is prudent. Prudent investment that will help franchises grow their offices, help team leaders build larger teams. And simultaneously, it sends a message across the industry that teams have yet another reason to affiliate with RE/MAX. Our full value proposition for teams is compelling. And we have third-party validation that RE/MAX teams are more productive than the norm. In many respects, the investment illustrates our commitment, a commitment to growing U.S. agent count and we believe growth initiatives like this overtime will help us regain crucial upward momentum in that regard.

Now, on the mortgage side, we remain confident in our mortgage-in-a-box product offering, growth prospects of our two brands and the investments we've made in the respective sales organizations over the past year. In 2023, during one of the most challenging end market conditions the mortgage industry has faced in recent history, we nonetheless grew our mortgage business, which when you think about it, it's a remarkable achievement and one that not too many other companies can claim. Now, having said that, our growth was muted and our model churn rate did pick up. Even in a rebounding market like the one we expect to see in 2024, our overall open model office count will continue to face macro headwinds. It's likely going to be flat but slightly up for the year.

Now, we expect to steadily improve our franchise sales as the market stabilizes and we rebuild our pipeline. Lastly, in September, RE/MAX, LLC entered into a nationwide settlement associated with costly industry litigation. We did so to protect our U.S. agents, franchisees and the company from multiple transaction lawsuits. The proposed settlement is subject to final court approval slated for early May and while the settlement came at a significant financial cost, we believe it was the right decision for all of our stakeholders, affiliates, employees, shareholders and debt-holders alike. We view it as an investment in the brand, the network, the franchisees and most importantly, the agents. Many people have suggested the proposed settlement's a differentiator.

It could actually create a new competitive advantage, we certainly hope so and think it can be. With that, I'll turn it over to Karri.

Karri Callahan: Thank you, Erik. Good morning, everyone. Better-than-expected margins from expected expense management highlighted our fourth quarter performance. Driven by deliberate moves we made last summer to right-size our cost structure amidst a very challenging housing market. Some of the notable quarterly financial highlights included total revenue of $76.6 million, adjusted EBITDA of $23 million with an adjusted EBITDA margin of 30%, and adjusted diluted EPS of $0.30. Looking closer at revenue, excluding the marketing funds, revenue was $56 million, a decrease of 5.8% compared to the same period last year. This decrease was driven by negative 5.6% organic growth and adverse foreign currency movements of 0.2%. Organic growth decreased principally due to a reduction in U.S. agent counts and lower broker fees, partially offset by higher mortgage segment revenue.

Notably, while our organic growth rate remained negative, the pace of the decline did slow since Q3 as we started to lap the tougher comparable quarters. Q4 selling, operating and administrative expenses increased 9.6% to $39.1 million, primarily due to changes in the fair value of contingent consideration liabilities. During the fourth quarter, given the continued macroeconomic pressures which caused mortgage rates to reach multi-decade highs, we revised the mortgage segment's near-term franchise sales forecast for the next three years. This, along with fewer-than-expected franchise sales in 2023, caused a decline in our mortgage segment's projected future cash flows. The reduction in our near-term franchise sales outlook was the principal driver of the non-cash goodwill impairment charge of $18.6 million.

Despite the current headwinds, we remain bullish on our mortgage opportunity and believe we can meaningfully accelerate our franchise sales pace over the medium and long term, given the compelling value proposition offered by both Motto and wemlo. From a capital allocation perspective, our priorities are unchanged since last quarter. While we are pleased to have been granted preliminary approval of our settlement and are seeing some reasons for optimism from a macro perspective, uncertainty with respect to 2024 remains. As a result, we continue to be responsible stewards of capital and think it's best to focus on replenishing our cash in the near term. That said, we believe we still have the financial flexibility to pursue those growth opportunities where we see the greatest potential.

Before I get to our outlook, I wanted to mention a few items impacting year-over-year comparisons. First, last year was the RE/MAX's 50th anniversary celebration, and our annual agent convention had the highest attendance in more than 15 years. We do expect a smaller crowd this year, resulting in a reduction to other revenue in Q1 of between $3 and $3.5 million. In addition, given the wind-down of our booj, First and Gadberry operations, we expect a year-over-year decline of approximately $3 million in revenue and $1 million in adjusted EBITDA in FY24. Of this amount, we expect the Q1 impact to be a year-over-year reduction of approximately $1 million in revenue and $0.5 million in earnings. Last, as a follow-up to what Erik mentioned related to teams, the Modified and Expanded Teams program offers an alternative fee structure that is designed to support and encourage the growth of medium- to large-size teams.

To activate the program's financial incentives, which include reduced recurring fees and a broker fee CAP, a brokerage in an eligible state must first add any combination of six new team leaders or members from outside of the network. As a result of this growth requirement, we expect to incur less than $1 million of foregone revenue in 2024 related to the expansion of this program. We included additional details about the initiative in our Form 10-K and are happy to answer any questions you might have regarding the program. Our first quarter and full year 2024 outlook assumes no further currency movements, acquisitions, or divestitures. For the first quarter of 2024, we expect agent counts to change from a negative 0.5% to a positive 0.5% over first quarter 2023, revenue in a range of $75 million to $80 million, including revenue from the marketing funds in a range of $19 million to $21 million, and adjusted EBITDA in a range of $16.5 million to $19.5 million.

For the full year 2024, we expect agent counts to change from a negative 0.5% to a positive 1.5% over full year 2023, revenue in a range of $300 million to $320 million, including revenue from the marketing funds in a range of $78 million to $82 million, and adjusted EBITDA in a range of $90 million to $100 million. With that, operator, let's open it up for questions.

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