UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
(
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Global Market | ||||
| Series A Cumulative Perpetual Preferred Share, par value $0.0001 per share) | Global Market | |||
| Series B Cumulative Perpetual Preferred Share, par value $0.0001 per share) | Global Market | |||
Not Applicable
(Former name or former address, if changed since last report)
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:
| 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)) |
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 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information regarding the Notes set forth in Item 8.01 to the Company’s Current Report on Form 8-K filed on December 3, 2021, Item 8.01 to the Company’s Current Report on Form 8-K filed on August 6, 2021, Item 8.01 to the Company’s Current Report on Form 8-K filed on March 29, 2021, Item 8.01 to the Company’s Current Report on Form 8-K filed on January 25, 2021, Item 1.01 to the Company’s Current Report on Form 8-K filed on February 12, 2020, Item 1.01 to the Company’s Current Report on Form 8-K filed on September 23, 2019, Item 1.01 to the Company’s Current Report on Form 8-K filed on May 7, 2019, is incorporated by reference into this Item 2.03.
Item 8.01. Other Events.
On January 5, 2022, B. Riley Financial, Inc. (the “Company”) filed a prospectus supplement related to the sale from time to time of up to $250,000,000 of the Company’s 6.75% Senior Notes due 2024 (the “2024 Notes”), 6.375% Senior Notes due 2025 (the “2025 Notes”), 6.50% Senior Notes due 2026 (the “6.50% 2026 Notes”), 5.50% Senior Notes due 2026 (the “5.50% 2026 Notes”), 5.00% Senior Notes due 2026 (the “5.00% 2026 Notes”), 6.00% Senior Notes due 2028 (the “6.00% 2028 Notes”) and 5.25% Senior Notes due 2028 (the “5.25% 2028 Notes,” and, together with the 2024 Notes, 2025 Notes, 6.50% 2026 Notes, 5.50% 2026 Notes, 5.00% 2026 Notes and 6.00% 2028 Notes, the “Notes”), Depositary Shares, each representing 1/1000th of a share of 6.875% Series A Cumulative Perpetual Preferred Stock (“Series A Preferred Stock”) (Liquidation Preference Equivalent to $25.00 per Depositary Share) (the “Series A Depositary Shares”) and Depositary Shares, each representing 1/1000th of a share of 7.375% Series B Cumulative Perpetual Preferred Stock (“Series B Preferred Stock”) (Liquidation Preference Equivalent to $25.00 per Depositary Share) (the “Series B Depositary Shares” and, together with the Notes and the Series A Depositary Shares, the “Offered Securities”). The prospectus supplement filed on January 5, 2022 replaces our prior prospectus supplement dated August 11, 2021, leaving up to approximately $135.2 million of Offered Securities available for offer and sale under the prospectus supplement filed on January 5, 2022.
On February 14, 2020, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc., pursuant to which the Company may offer and sell, from time to time, the Offered Securities. Sales of the Offered Securities pursuant to the Sales Agreement, if any, may be made in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended. The Offered Securities sold pursuant to the Sales Agreement will be issued pursuant to a prospectus dated January 28, 2021, as supplemented by a prospectus supplement dated January 5, 2022, in each case filed with the Securities and Exchange Commission pursuant to the Company’s effective Registration Statement on Form S-3ASR (File No. 333-252513) (the “Registration Statement”), which was automatically effective upon filing on January 28, 2021.
The Notes have been and are issued pursuant to the terms and conditions of an Indenture entered into by and between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee, dated as of May 7, 2019, as supplemented by the First Supplemental Indenture dated as of May 7, 2019, the Second Supplemental Indenture dated as of September 23, 2019, the Third Supplemental Indenture dated as of February 12, 2020, the Fourth Supplemental Indenture dated as of January 25, 2021, the Fifth Supplemental Indenture dated as of March 29, 2021, the Sixth Supplemental Indenture dated as of August 6, 2021 and the Seventh Supplemental Indenture dated as of December 3, 2021.
The Series A Preferred Stock is being issued pursuant to the certificate of designation that sets forth the terms of a series of preferred stock consisting of up to 10,000 shares, designated 6.875% Series A Cumulative Perpetual Preferred Stock.
The Series B Preferred Stock is being issued pursuant to the certificate of designation that sets forth the terms of a series of preferred stock consisting of up to 10,000 shares, designated 7.375% Series B Cumulative Perpetual Preferred Stock.
The 2024 Notes, 2025 Notes, 6.50% 2026 Notes, 5.50% 2026 Notes, 5.00% 2026 Notes, 6.00% 2028 Notes and 5.25% 2028 Notes are listed on NASDAQ under the symbols “RILYO,” “RILYM,” “RILYN,” “RILYK,” “RILYG,” “RILYT,” and “RILYZ,” respectively. The Series A Depositary Shares are listed on NASDAQ under the symbol “RILYP” and the Series B Depositary Shares are listed on NASDAQ under the symbol “RILYL.”
The foregoing description of the Sales Agreement is not complete and is qualified in its entirety by reference to the entire Sales Agreement, included as Exhibit 1.2 to the Company’s Form S-3 filed on February 14, 2020, and incorporated herein by reference.
The foregoing description of the Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the form of the 2024 Notes, 6.50% 2026 Notes, 2025 Notes, 6.00% 2028 Notes, 5.50% 2026 Notes, 5.25% 2028 Notes and 5.00% 2026 Notes, included as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on May 7, 2019, Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on September 23, 2019, Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on February 12, 2020, Exhibit 4.5 to the Company’s Current Report on Form 8-K filed on January 25, 2021, Exhibit 4.6 to the Company’s Current Report on Form 8-K filed on March 29, 2021, Exhibit 4.7 to the Company’s Current Report on Form 8-K filed on August 6, 2021 and Exhibit 4.8 to the Company’s Current Report on Form 8-K filed on December 3, 2021, and incorporated by reference herein and into the Registration Statement.
The foregoing description of the Series A Depositary Shares and Series B Depositary Shares does not purport to be a complete description and is qualified in its entirety by reference to their respective Certificate of Designations, included as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on October 7, 2019 and Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on September 4, 2020, and incorporated by reference here and into the Registration Statement.
Attached as Exhibit 5.1 to this Current Report and incorporated herein by reference is a copy of the opinion of The NBD Group, Inc. relating to the validity of the Offered Securities issuable under the Sales Agreement (the “Legal Opinion”). The Legal Opinion is also filed with reference to, and is hereby incorporated by reference into, the Registration Statement.
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Item 9.01. Financial Statements and Exhibits.
| (d) | Exhibits. |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
| B. RILEY FINANCIAL, INC. | ||
| Date: January 5, 2022 | By: | /s/ Phillip J. Ahn |
| Name: | Phillip J. Ahn | |
| Title: | Chief Financial Officer & Chief Operating Officer | |
3
Exhibit 5.1
theNBDgroup.
A Professional Corporation
https://nbdpro.co/
January 5, 2022
B. Riley Financial, Inc.
11100 Santa Monica Blvd., Suite 800
Los Angeles, California 90025
Ladies and Gentlemen:
We have acted as counsel to B. Riley Financial, Inc., a Delaware corporation (the “Company”), in connection with the issuance and sale, from time to time, by the Company of up to $250,000,000 aggregate principal amount of the Company’s 6.75% Senior Notes due 2024 (the “2024 Notes”), 6.375% Senior Notes due 2025 (the “2025 Notes”), 6.50% Senior Notes due 2026 (the “2026 Notes”), 5.50% Senior Notes due 2026 (the “5.50% 2026 Notes”), 5.00% Senior Notes due 2026 (the “5.00% 2026 Notes”), 6.00% Senior Notes due 2028 (the “6.00% 2028 Notes”) and 5.25% Senior Notes due 2028 (“5.25% 2028 Notes,” and, together with the 2024 Notes, 2025 Notes, 6.50% 2026 Notes, 5.50% 2026 Notes, 5.00% 2026 Notes and 6.00% 2028 Notes, the “Notes”) and the Company’s Depositary Shares, each representing 1/1000th of a share of the Company’s 6.875% Series A Cumulative Perpetual Preferred Stock, par value $0.0001 per share and liquidation preference of $25,000 per share (the “Series A Depositary Shares”) and the Company’s Depositary Shares, each representing 1/1000th of a share of the Company’s 7.375% Series B Cumulative Perpetual Preferred Stock, par value $0.0001 per share and liquidation preference of $25,000 per share (the “Series B Depositary Shares” and, together with the Series A Depositary Shares and the Notes, the “Placement Securities”), pursuant to the terms of an At Market Issuance Sales Agreement, dated as of February 14, 2020 (the “Sales Agreement”), by and among the Company and B. Riley FBR, Inc. (which has been renamed B. Riley Securities, Inc.).
The Notes have been and are issued pursuant to the terms and conditions of an Indenture entered into by and between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the “BNYM Trustee”), dated as of May 7, 2019 (the “Base Indenture”), as supplemented by the First Supplemental Indenture dated as of May 7, 2019 (the “First Supplemental Indenture”), the Second Supplemental Indenture dated as of September 23, 2019 (the “Second Supplemental Indenture”), the Third Supplemental Indenture dated as of February 12, 2020 (the “Third Supplemental Indenture”), the Fourth Supplemental Indenture dated as of January 25, 2021 (the “Fourth Supplemental Indenture”), the Fifth Supplemental Indenture dated as of March 29, 2021 (the “Fifth Supplemental Indenture”), the Sixth Supplemental Indenture dated as of August 6, 2021 (the “Sixth Supplemental Indenture”) and the Seventh Supplemental Indenture dated as of December 3, 2021 (the “Seventh Supplemental Indenture,” and, together with the Base Indenture, First Supplemental Indenture, Second Supplemental Indenture, Third Supplemental Indenture, Fourth Supplemental Indenture, Fifth Supplemental Indenture and Sixth Supplemental Indenture, the “2019 Indenture”). The Series A Preferred Stock is being issued pursuant to the certificate of designation that sets forth the terms of a series of preferred stock consisting of up to 10,000 shares, designated 6.875% Series A Cumulative Perpetual Preferred Stock. The Series B Preferred Stock is being issued pursuant to the certificate of designation that sets forth the terms of a series of preferred stock consisting of up to 10,000 shares, designated 7.375% Series B Cumulative Perpetual Preferred Stock.
This opinion is furnished to you in connection with the shelf registration statement on Form S-3ASR (Registration No. 333-252513), filed by the Company with the Securities and Exchange Commission (the “Commission”) on January 28, 2021, and automatically effective upon filing (the “Registration Statement”), in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder (collectively, the “Act”), relating to the issuance and sale of the Placement Securities.
In connection with this opinion, we have examined originals, copies or forms of: (i) the Registration Statement; (ii) the prospectus, dated January 28, 2021 (the “Base Prospectus”), which forms a part of the Registration Statement; (iii) the prospectus supplement, dated January 5, 2022, in the form filed with the Commission pursuant to Rule 424(b) under the Act (together with the Base Prospectus and the documents incorporated and deemed to be incorporated by reference therein, herein collectively referred to as the “Prospectus”); (iv) the 2019 Indenture, (v) a copy of the Amended and Restated Certificate of Incorporation of the Company, as amended to the date hereof and currently in effect, as certified by the Secretary of the State of Delaware; (vi) a copy of the By-laws of the Company, as currently in effect, as certified by the Secretary of the Company; and (vii) certain resolutions of the Board of Directors of the Company, approved on January 4, 2022 (such documents outlined in clauses (i) – (vii), the “Documents”). In addition, we have examined such records, documents, certificates of public officials and of the Company, made such inquiries of officers of the Company, and considered such questions of law as we have deemed necessary for the purpose of rendering the opinions set forth herein.
In connection with this opinion, we have assumed: (i) the authenticity of original documents and the genuineness of all signatures; (ii) the conformity to the originals of all documents submitted to us as copies; (iii) the truth, accuracy and completeness of the information, representations and warranties contained in the instruments, documents, certificates and records we have reviewed; (iv) that all Placement Securities will be issued and sold in compliance with applicable U.S. federal and state securities laws and in the manner stated in the Registration Statement and the Prospectus; (v) that each party thereto (other than the Company) has the corporate or other power and authority to execute, deliver and perform such Documents; (vi) that each party thereto (other than the Company) has duly authorized, executed and delivered such Documents; (vii) that each Document is the legal, valid and binding obligation of such party (other than the Company) enforceable against such party in accordance with its terms; (viii) that the 2019 Indenture constitute the legal, valid and binding obligation of the BNYM Trustee and has been duly authenticated by the BNYM Trustee and will be duly qualified under the Trust Indenture Act of 1939, as amended; and (ix) the legal capacity of all natural persons. As to any facts material to the opinions expressed herein that were not independently established or verified, we have relied upon oral or written statements and representations of officers and other representatives of the Company, including a certificate from officers of the Company with respect to certain factual matters.
The opinions hereinafter expressed are subject to the following further qualifications and exceptions:
| (1) | We express no opinion as to the effect of bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar laws relating to or affecting the rights of creditors generally, including, without limitation, laws relating to fraudulent transfers or conveyances, preferences and equitable subordination. |
| (2) | We express no opinion as to limitations imposed by general principles of equity upon the availability of equitable remedies or the enforcement of provisions of the Documents; and the effect of judicial decisions which have held that certain provisions are unenforceable where their enforcement would violate the implied covenant of good faith and fair dealing, or would be commercially unreasonable, or where a default under the Documents is not material. |
| (3) | We express no opinion as to the effect of judicial decisions permitting the introduction of extrinsic evidence to supplement the terms or aid in the interpretation of the Documents. |
| (4) | We express no opinion as to the effect on the opinions expressed herein of (i) the compliance or non-compliance of any party to the Documents with any law, regulation or order applicable to it, or (ii) the legal or regulatory status or the nature of the business of any such party. |
| (5) | We express no opinion as to the enforceability of provisions of the Documents providing for indemnification or contribution, to the extent such indemnification or contribution is against public policy. |
| (6) | We express no opinion as to the enforceability of provisions of the Documents imposing or which are construed as effectively imposing a penalty. |
| (7) | We express no opinion as to the enforceability of any provision of the Documents which purports to establish evidentiary standards or to make determinations conclusive or powers absolute. |
| (8) | We express no opinion as to the enforceability of the waiver of stay or extension laws contained in Section 5.15 of the 2019 Indenture. |
| (9) | We express no opinion as to the enforceability of any choice of law provisions contained in the Documents or the enforceability of any provisions which purport to establish a particular court as the forum for adjudication of any controversy relating to the Documents or which purport to cause any party to waive or alter any right to a trial by jury or which waive objection to jurisdiction. |
Further, we express no opinion as to the effect on the opinions expressed herein of (i) the compliance or non-compliance of any party to the 2019 Indenture and the Notes with any law, regulation or order applicable to it, (ii) the legal or regulatory status or the nature of the business of any such party, (iii) provisions of the 2019 Indenture under which the Company submits to the jurisdiction of one or more New York courts or federal courts located in the State of New York are subject to the application of the doctrine of forum non conveniens or a similar statutory principle or as to the subject matter jurisdiction of the federal courts located in the State of New York to adjudicate any dispute under the 2019 Indenture, (iv) provisions of the 2019 Indenture which purport to prohibit or restrict a transfer of rights under the 2019 Indenture or (v) provisions of the 2019 Indenture providing for rights of setoff.
Our opinion is based upon current statutes, rules, regulations, cases and official interpretive opinions, and it covers certain items that are not directly or definitively addressed by such authorities.
Based upon and subject to the limitations and qualifications set forth herein, we are of the opinion that:
| 1. | The Series A Depositary Shares and the Series B Depositary Shares to be sold by the Company have been duly authorized and, assuming the terms of any sale of the Series A Depositary Shares and the Series B Depositary Shares pursuant to the Sales Agreement are approved by the Board of Directors or a duly authorized committee thereof, when issued and delivered by the Company and paid for pursuant to the Sales Agreement, the Series A Depositary Shares and the Series B Depositary Shares will be validly issued, fully paid and non-assessable. |
| 2. | The Notes, when issued, executed and authenticated in accordance with the provisions of the 2019 Indenture and delivered against payment therefor in the manner contemplated by the Sales Agreement and the terms of the Registration Statement, will be legally issued and binding obligations of the Company pursuant to the terms of the 2019 Indenture, enforceable against the Company in accordance with their terms. |
Our opinions set forth herein are limited to (i) the General Corporation Law of the State of Delaware and (ii) the laws of the State of New York that, in our experience, are normally applicable to the Placement Securities and, to the extent that judicial or regulatory orders or decrees or consents, approvals, licenses, authorizations, validations, filings, recordings or registrations with governmental authorities are relevant, to those required under such laws (all of the foregoing being referred to as “Opined on Law”). We do not express any opinion as to any non-Opined on Law on the opinions herein stated.
We hereby consent to the filing of this opinion as exhibit 5.1 to the Company’s Current Report on Form 8-K, being filed on the date hereof, and incorporated by reference into the Registration Statement. We also hereby consent to the use of our name under the heading “Legal Matters” in the Prospectus. In giving such consent, we do not hereby admit that we are acting within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder. This opinion is expressed as of the date hereof unless otherwise expressly stated, and we disclaim any undertaking to advise you of any subsequent changes in the facts stated or assumed herein or of any subsequent changes in applicable laws.
Very truly yours,
/s/ The NBD Group, Inc.