8-K
Reliance Global Group, Inc. (EZRA)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest reported): May 12, 2023
RelianceGlobal Group, Inc.
(Exact name of registrant as specified in its charter)
| Florida | 001-40020 | 46-3390293 |
|---|---|---|
| (State<br> or other jurisdiction | (Commission | (IRS<br> Employer |
| of<br> Incorporation) | File<br> Number) | Identification<br> Number) |
300Blvd. of the Americas, Suite 105, Lakewood, NJ 08701
(Address of principal executive offices)
(732)380-4600
(Registrant’s telephone number, including area code)
N/A
(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 (see General Instruction A.2.)
| ☐ | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CF$ 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title<br> of Each Class | Trading<br> Symbol(s) | Name<br> of Each Exchange on which Registered |
|---|---|---|
| Common<br> Stock, $0.086 par value per share | RELI | The<br> Nasdaq Capital Market |
| Series<br> A Warrants to purchase shares of Common Stock, par value $0.086 per share | RELIW | The<br> Nasdaq Capital Market |
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. ☐
Item2.02. Results of Operations and Financial Condition.
On May 18, 2023, Reliance Global Group, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended May 18, 2023. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in any website is not a part of this Current Report on Form 8-K.
In accordance with General Instruction B.2 of Form 8-K, the information included in this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item4.02. Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.
On May 12, 2023, the Company determined that the following financial statements should be restated and should no longer be relied upon:
| (i) | The<br> Company’s unaudited consolidated financial statements for the three months ended March<br> 31, 2022 included in the Company’s Quarterly Report on Form 10-Q, filed with the Securities<br> and Exchange Commission (the “SEC”) on May 16, 2022 (the “Q1 2022<br> 10-Q”); |
|---|---|
| (ii) | The<br> Company’s unaudited consolidated financial statements for the three and six months<br> ended June 30, 2022 included in the Company’s Quarterly Report on Form 10-Q, filed<br> with the SEC on August 15, 2022 (the “Q2 2022 10-Q”) |
| (iii) | The<br> Company’s unaudited consolidated financial statements for the three and nine months<br> ended September 30, 2022 included in the Company’s Quarterly Report on Form 10-Q, filed<br> with the SEC on November 14, 2022 (the “Q3 2022 10-Q” and collectively with the<br> Q1 2022 10-Q and the Q2 2022 10-Q, the “Filings”). |
Subsequent to the Company’s filing of the Filings, the Company performed an evaluation of its accounting in connection with the calculation of its basic earnings per share (“EPS”) and diluted EPS and identified errors in such calculations. The errors resulted from improper application of sequencing rules, a miscalculation of the numerator used in the determination of diluted EPS, and a miscalculation of the denominator used in the determination of weighted average shares outstanding for both basic EPS and diluted EPS, and the Company determined that the errors required adjustments of the previously issued financial statements in the Filings.
The Company determined that the reporting effects of the above errors had a material impact to the Company’s unaudited consolidated financial statements included in the Filings. As a result, the unaudited consolidated financial statements for the three months ended March 31, 2022, the unaudited consolidated financial statements for the three and six months ended June 30, 2022, and the unaudited consolidated financial statements for the three and nine months ended September 30, 2022 will be restated, and the Company will file an amendment to each of the Q1 2022 10-Q, the Q2 2022 10-Q and the Q3 2022 10-Q with the SEC.
Except for EPS, there were no errors identified in the financial statements included in the Filings for revenue, expenses and net income (loss), which remain unaffected and unchanged in the amended filings to be filed with the SEC.
The Company’s management concluded that in light of the errors mentioned above, a material weakness existed in the Company’s internal control over financial reporting as of March 31, 2022, June 30, 2022 and September 30, 2022, and the Company’s disclosure controls and procedures were not effective as of such dates.
The Company’s management and its Board of Directors have discussed the matters disclosed in this Current Report on Form 8-K pursuant to this Item 4.02 with Mazars USA LLP, the Company’s independent registered public accounting firm.
Item9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press release of the registrant issued on May 18, 2023. |
| 104 | Cover<br> Page Interactive Data File |
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.
| Reliance Global Group, Inc. | ||
|---|---|---|
| Dated:<br> May 18, 2023 | By: | /s/ Ezra Beyman |
| Ezra<br> Beyman | ||
| Chief<br> Executive Officer |
Exhibit99.1
RelianceGlobal Group Achieves 29% Increase in Revenue for the First Quarter of 2023
RELIExchange Continuing to Add New Agency Partners and Support Growth
Companyto Host Conference Call Today at 4:30 PM Eastern Time
LAKEWOOD,N.J., May 18, 2023 — Reliance Global Group, Inc. (Nasdaq: RELI; RELIW) (“Reliance”, “we” or the “Company”), today provided a business update and reported financial results for the first quarter ended March 31, 2023.
Ezra Beyman, CEO of Reliance, commented, “We are pleased to announce a 29% increase in revenue for the first quarter of 2023, compared to the same period in 2022. We’ve also reduced our operating costs by 9%, which includes a reduction in general and administrative expenses of approximately 42%, partially offset by investments to support our continued growth. As a result of these activities, our net operating results improved by approximately 60%. It is also important to note that our operating agencies are collectively performing well and remain profitable with healthy margins, on a standalone basis. We look forward to continuing and building on this trajectory of sustained growth with increased profit margins and positive cash flows.”
“Further, RELI Exchange continues to perform well, with over 250 agency partners now on our platform. We attribute this success to the fact that RELI Exchange provides independent insurance agents with an extensive array of business tools, enabling them to effectively compete with, and even outperform, larger national agencies. Initially, we focused on recruiting newer agents to the platform. However, as the platform has matured, we are now transitioning our efforts to attract more experienced agents with an established clientele. Historically, many of these agents were restricted to offering a single carrier, leading to a low close rate due to the unfavorable captive agreement. On our platform, with access to many carriers, we believe our partners will have a much more competitive offering, given they can now offer a broader selection of quotes with many of the largest insurance companies.”
“In addition to home and auto insurance, we are constantly looking to add new products that our agency partners can offer their clients. For example, in February 2023, we incorporated a proprietary life insurance quote tool into the platform, allowing agents to compare life insurance policies and prices in less than a minute, thus enhancing client conversations and expediting policy binding. In March 2023, we introduced RELI University, a new training platform for our RELI Exchange agency partners. The platform provides both new and experienced agents with a complete education on all the products, services, and tools available through RELI Exchange.”
“With most of the RELI Exchange investment now behind us, coupled with strong performance from our operating agencies, we have built and continue to build a highly scalable business poised to drive significant returns for our shareholders.”
The Company’s complete financial results are available in its Quarterly Report on Form 10-Q, which will be filed with the U.S. Securities & Exchange Commission today.
ConferenceCall
Reliance Global Group will host a conference call today at 4:30 PM. Eastern Time to discuss the Company’s financial results for the quarter ended March 31, 2023, as well as the Company’s corporate progress and other developments.
The conference call will be available via telephone by dialing toll-free +1 877-545-0523 for U.S. callers or +1 973-528-0016 for international callers and using entry code: 539575. A webcast of the call may be accessed at https://www.webcaster4.com/Webcast/Page/2381/48391 or on the investor relations section of the Company’s website at https://relianceglobalgroup.com/events-and-presentations/.
A webcast replay will also be available on the Company’s Investors section of the website (https://relianceglobalgroup.com/events-and-presentations/) through May 15, 2024. A telephone replay of the call will be available approximately one hour following the call, through June 1, 2023, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering conference ID: 48391.
AboutReliance Global Group, Inc.
Reliance Global Group, Inc. (NASDAQ: RELI, RELIW) is an InsurTech pioneer, leveraging artificial intelligence (AI), and cloud-based technologies, to transform and improve efficiencies in the insurance agency/brokerage industry. The Company’s business-to-business InsurTech platform, RELI Exchange, provides independent insurance agencies an entire suite of business development tools, enabling them to effectively compete with large-scale national insurance agencies, whilst reducing back-office cost and burden. The Company’s business-to-consumer platform, 5minuteinsure.com, utilizes AI and data mining, to provide competitive online insurance quotes within minutes to everyday consumers seeking to purchase auto, home, and life insurance. In addition, the Company operates its own portfolio of select retail “brick and mortar” insurance agencies which are leaders and pioneers in their respective regions throughout the United States, offering a wide variety of insurance products. Further information about the Company can be found at https://www.relianceglobalgroup.com.
Forward-LookingStatements
Thispress release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private SecuritiesLitigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-lookingstatements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. In somecases, forward-looking statements can be identified by terminology such as “may,” “should,” “potential,”“continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,”“estimates,” and similar expressions and include statements such as the Company having built a best-in-class InsurTech platform,making RELI Exchange an even more compelling value proposition and further accelerating growth of the platform, rolling out several otherservices in the near future to RELI Exchange agency partners, building RELI Exchange into the largest agency partner network in the U.S.,the Company moving in the right direction and the Company’s highly scalable business model driving significant shareholder value.Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including thosedescribed from time to time in our filings with the Securities and Exchange Commission and elsewhere and risks as and uncertainties relatedto: the Company’s ability to generate the revenue anticipated and the ability to build the RELI Exchange into the largest agencypartner network in the U.S., and the other factors described in the Company’s Annual Report on Form 10-K for the fiscal year endedDecember 31, 2022, as the same may be updated from time to time2021. The foregoing review of important factors that could cause actualevents to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are includedherein and elsewhere, including the risk factors included in the Company’s Annual Report on Form 10-K for the fiscal year endedDecember 31, 2022, the Company’s Quarterly Reports on Form 10-Q, the Company’s Current Reports on Form 8-K and othersubsequentfilings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein.All forward-looking statements speak only as of the date of this press release.
Contact:
Crescendo Communications, LLC
Tel: +1 (212) 671-1020
Email: RELI@crescendo-ir.com