BRC Group Holdings, Inc S-3ASR, filed Jan 28, 2021

BRC Group Holdings, Inc. (RILY)

S-3ASR 2021-01-28

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Delaware		27-0223495
(State of Incorporation)		(IRS Employer Identification No.)

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

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price (1)(2)	Amount of Registration Fee
Primary Offering of Securities:
Common Stock, par value $0.0001 per share	(3)	(4)
Preferred Stock, par value $0.0001 per share	(3)	(4)
Warrants	(3)	(4)
Debt Securities	(3)	(4)
Depositary Shares (6)	(3)	(4)
Units (7)	(3)	(4)
Primary Offering of Debt Securities and Depositary Shares	$150,000,000	$16,365(5)

(1)	Securities registered hereunder may be sold separately or as units with other securities registered hereunder.
(2)	An indeterminate aggregate initial offering price and number or amount of the securities of each identified class is being registered as may from time to time be issued at indeterminate prices. The securities registered also include such indeterminate amounts and numbers of common stock as may be issued upon conversion of or exchange for preferred stock, warrants or debt securities that provide for such conversion or exchange. Separate consideration may or may not be received for securities that are issuable upon conversion of, or in exchange for, or upon exercise of, convertible or exchangeable securities.
(3)	Omitted pursuant to General Instruction II.E of Form S-3.
(4)	Pursuant to Rules 456(b) and 457(r) under the Securities Act, the Registrant is deferring payment of all applicable registration fees. Any registration fees will be paid subsequently on a pay-as-you-go basis in accordance with Rule 457(r).
(5)	Calculated pursuant to Rule 457(o) and Rule 457(r) under the Securities Act.
(6)	In the event that the registrant elects to offer to the public fractional interests in shares of preferred stock registered hereunder, depositary shares, evidenced by depositary receipts, issued pursuant to a deposit agreement, will be distributed to those persons purchasing such fractional interests, and the shares of preferred stock will be issued to the depositary under any such agreement.
(7)	Consisting of some or all of the securities listed above, in any combination, including common stock, preferred stock, warrants, debt securities or depositary shares.

	Page
ABOUT B. RILEY FINANCIAL, INC.	1
RISK FACTORS	3
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS	3
DETERMINATION OF OFFERING PRICE	3
USE OF PROCEEDS	3
SECURITIES WE MAY OFFER	4
DESCRIPTION OF CAPITAL STOCK	4
DESCRIPTION OF WARRANTS	6
DESCRIPTION OF DEBT SECURITIES	7
DESCRIPTION OF DEPOSITARY SHARES	14
DESCRIPTION OF UNITS	16
PLAN OF DISTRIBUTION	17
LEGAL MATTERS	19
EXPERTS	19
WHERE YOU CAN FIND MORE INFORMATION	20
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE	20

	○	sell or otherwise dispose of assets;

	○	enter into sale-leaseback transactions;

	●	if we fail to pay interest when due and payable and our failure continues for 30 days and the time for payment has not been extended or deferred;

	●	if we fail to pay the principal or premium, if any, when due and payable and the time for payment has not been extended or deferred;

	●	if we fail to deposit any sinking fund payment, to the extent applicable, when and as due;

	●	register the transfer or exchange of debt securities of the series;

	●	replace stolen, lost or mutilated debt securities of the series;

	●	Our quarterly report on Form 10-Q for the quarterly periods ended March 31, 2020, June 30, 2020, and September 30, filed with the SEC on May 11, 2020, August 3, 2020 and October 30, 2020, respectively;

	●	Our annual report on Form 10-K for the year December 31, 2019, filed with the SEC on March 10, 2020 and Form 10-K/A filed with the SEC on April 23, 2020;

	●	Our current reports on Form 8-K/A filed with the SEC on November 26, 2019, and our current reports on Form 8-K filed with the SEC on November 1, 2019, January 9, 2020, February 10, 2020, February 12, 2020, February 21, 2020, April 13, 2020, May 6, 2020, May 15, 2020, June 24, 2020, September 1, 2020, September 4, 2020, September 14, 2020, October 13, 2020, January 6, 2021, January 11, 2021, January 15, 2021 and January 25, 2021;

	●	Description of our common stock contained in our Registration Statement on Form 8-A filed on July 15, 2015;

	●	Certificate of Designation designating the 6.875% Series A Cumulative Perpetual Preferred Stock filed on October 4, 2019; and

	●	Certificate of Designation designating the 7.375% Series B Cumulative Perpetual Preferred Stock filed on September 3, 2020.

	●	7.25% Senior Notes due 2027 (the “2027 Notes”); and

	●	6.00% Senior Notes due 2028 (the “2028 Notes”, and together with the 7.375% 2023 Notes, the 6.875% 2023 Notes, the 2024 Notes, the 2025 Notes, the 2026 Notes and the 2027 Notes, the “Notes”);

	●	Series A Depositary Shares (the “Series A Depositary Shares”), each representing 1/1000^thof a share of 6.875% Series A Cumulative Perpetual Preferred Stock (Liquidation Preference Equivalent to $25.00 per Depositary Share) (the “Series A Preferred Stock”); and

	●	Series B Depositary Shares (the “Series B Depositary Shares” and, together with the Series A Depositary Shares, the “Depositary Shares” and together, with the Notes, the “Offered Securities”), each representing 1/1000^thof a share of 7.375% Series B Cumulative Perpetual Preferred Stock (Liquidation Preference Equivalent to $25.00 per Depositary Share) (the “Series B Preferred Stock”).

	Page
ABOUT THIS SALES AGREEMENT PROSPECTUS	S-1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS	S-2
Sales Agreement PROSPECTUS SUMMARY	S-4
THE OFFERING	S-6
RISK FACTORS	S-15
USE OF PROCEEDS	S-20
DESCRIPTION OF THE NOTES	S-21
DESCRIPTION OF SERIES A PREFERRED STOCK AND THE SERIES A DEPOSITARY SHARES	S-38
DESCRIPTION OF SERIES B PREFERRED STOCK AND THE SERIES B DEPOSITARY SHARES	S-47
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS	S-59
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS FOR DEPOSITARY SHARES	S-64
PLAN OF DISTRIBUTION (Conflict of Interest)	S-68
EXPERTS	S-69
LEGAL MATTERS	S-69
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE	S-69

	●	B. Riley Securities, Inc. (“B. Riley Securities”) is a leading, full service investment bank providing financial advisory, corporate finance, research, securities lending and sales and trading services to corporate, institutional and high net worth individual clients. B. Riley Securities (fka B. Riley FBR, Inc.) was formed in November 2017 through the merger of B. Riley & Co, LLC and FBR Capital Markets & Co., which the Company acquired in June 2017.

	●	B. Riley Wealth Management, Inc. provides comprehensive wealth management and brokerage services to individuals and families, corporations and non-profit organizations, including qualified retirement plans, trusts, foundations and endowments.

	●	B. Riley Capital Management, LLC, a Securities and Exchange Commission (“SEC”) registered investment advisor, which includes:

	●	B. Riley Asset Management, an advisor to certain private funds and to institutional and high net worth investors;

	●	Great American Capital Partners, LLC (“GACP”), the general partner of two private funds, GACP I, L.P. and GACP II, L.P., both direct lending funds that provide senior secured loans and second lien secured loan facilities to middle market public and private U.S. companies.

	●	Our subsidiaries doing business as B. Riley Advisory Services:

	●	GlassRatner Advisory & Capital Group LLC (“GlassRatner”), a specialty financial advisory services firm that provides consulting services to shareholders, creditors and companies, including due diligence, fraud investigations, corporate litigation support, crisis management and bankruptcy services. We acquired GlassRatner on August 1, 2018. GlassRatner strengthens B. Riley’s diverse platform and compliments the restructuring services provided by B. Riley Securities.

	●	Great American Group Advisory and Valuation Services, LLC, a leading provider of appraisal and valuation services for asset based lenders, private equity firms and corporate clients.

	●	UOL is a communications company that offers consumer subscription services and products, consisting of Internet access services and devices under the NetZero and Juno brands primarily sold in the United States.

Issuer	B. Riley Financial, Inc.

Offered Securities	Up to $150,000,000 aggregate amount of our: ● 7.375% 2023 Notes; ● 6.875% 2023 Notes; ● 2024 Notes; ● 2025 Notes; ● 2026 Notes; ● 2027 Notes; ● 2028 Notes; ● Series A Depositary Shares; and ● Series B Depositary Shares. The 7.375% 2023 Notes, 6.875% 2023 Notes, 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes offered hereby are a further issuance of, form of a single series with and will have the same terms as the Initial 7.375% 2023 Notes, Initial 6.875% 2023 Notes, Initial 2024 Notes, Initial 2025 Notes, Initial 2026 Notes, Initial 2027 Notes and Initial 2028 Notes, respectively.

Manner of offering	“At the market offering” that may be made from time to time through the Agent, as sales agent, subject to our instruction as to amount and timing. The Agent is not required to sell any specific principal amount of the Notes, but the Agent will make all sales using commercially reasonable efforts consistent with its normal trading and sales practices on mutually agreed terms between the Agent and us. See “Plan of Distribution” on page S-67.
Notes
Maturity	The 7.375% 2023 Notes will mature on May 31, 2023, the 6.875% 2023 Notes will mature on September 30, 2023, the 2024 Notes will mature on May 31, 2024, the 2025 Notes will mature on February 28, 2025, the 2026 Notes will mature on September 30, 2026, the 2027 Notes will mature on December 31, 2027 and the 2028 Notes will mature on January 31, 2028, each unless redeemed prior to maturity.

Interest Rate and Payment Dates	7.375% interest per annum on the principal amount of the 7.375% 2023 Notes, 6.875% interest per annum on the principal amount of the 6.875% 2023 Notes, 6.75% interest per annum on the principal amount of the 2024 Notes, 6.375% interest per annum on the principal amount of the 2025 Notes, 6.50% interest per annum on the principal amount of the 2026 Notes, 7.25% interest per annum on the principal amount of the 2027 Notes, and 6.00% interest per annum on the principal amount of the 2028 Notes will accrue from the most recent interest payment date immediately preceding the date of issuance of the 7.375% 2023 Notes, 6.875% 2023 Notes, 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes, respectively, except that Notes purchased after the record dates noted below, but prior to the interest payment date immediately following such record date (or if settlement of a purchase of Notes otherwise occurs after such record date but prior to the interest payment date immediately following such record date), such Notes will not begin to accrue interest until the interest payment date immediately following such record date. Interest will be paid quarterly in arrears on January 31, April 30, July 31 and October 31 of each year. The interest payable on each interest payment date will be paid only to holders of record of the Notes at the close of business on January 15, April 15, July 15 and October 15 of each year, as the case may be, immediately preceding the applicable interest payment date. As a general matter, holders of the Notes will not be entitled to receive any payments of principal on the Notes prior to the stated maturity date.

Guarantors	None.

Ranking	The Notes will be our senior unsecured obligations and will rank equal in right of payment with all of our existing and future senior unsecured and unsubordinated indebtedness. The Notes will be effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes will be structurally subordinated to all existing and future indebtedness (including trade payables) of our subsidiaries.

	The indentures governing the Notes do not limit the amount of indebtedness that we or our subsidiaries may incur or whether any such indebtedness can be secured by our assets.

Optional Redemption	We may redeem the 7.375% 2023 Notes in whole or in part at our option (i) on or after May 31, 2020 and prior to May 31, 2021, at a price equal to $25.75 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after May 31, 2021 and prior to May 31, 2022, at a price equal to $25.375 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iii) on or after May 31, 2022 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding the date of redemption. We may redeem the 6.875% 2023 Notes in whole or in part at our option (i) on or after September 30, 2020 and prior to September 30, 2021, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after September 30, 2021 and prior to September 30, 2022, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iii) on or after September 30, 2022 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding the date of redemption. We may redeem the 2024 Notes for cash in whole or in part at any time at our option (i) on or after May 31, 2021 and prior to May 31, 2022, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after May 31, 2022 and prior to May 31, 2023, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iii) on or after May 31, 2023 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption. We may redeem the 2026 Notes for cash in whole or in part at any time at our option (i) on or after September 30, 2022 and prior to September 30, 2023, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after September 30, 2023 and prior to September 30, 2024, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iii) on or after September 30, 2024 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption. We may redeem the 2025 Notes for cash in whole or in part at any time at our option (i) on or after February 28, 2021 and prior to February 28, 2022, at a price equal to $25.75 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after February 28, 2022 and prior to February 28, 2023, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (iii) on or after February 28, 2023 and prior to February 29, 2024, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iv) on or after February 29, 2024 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption.

	We may redeem the 2026 Notes for cash in whole or in part at any time at our option (i) on or after September 30, 2022 and prior to September 30, 2023, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after September 30, 2023 and prior to September 30, 2024, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iii) on or after September 30, 2024 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption.

	We may redeem the 2027 Notes in whole or in part on or after December 31, 2020, at our option, at a redemption price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption.

	We may redeem the 2028 Notes for cash in whole or in part at any time at our option (i) on or after January 31, 2022 and prior to January 31, 2023, at a price equal to $25.75 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after January 31, 2023 and prior to January 31, 2024, at a price equal to $25.50 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, (iii) on or after January 31, 2024 and prior to January 31, 2025, at a price equal to $25.25 per note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iv) on or after January 31, 2025 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption See “Description of the Notes — Optional Redemption” for additional details.

Sinking Fund	The Notes will not be subject to any sinking fund (i.e., no amounts will be set aside by us to ensure repayment of the Notes at maturity).

Use of Proceeds	We expect to use the net proceeds of this offering for general corporate purposes, which may include funding future acquisitions and investments, repaying and/or refinancing indebtedness, making loans and/or providing guaranty or backstop commitments to our clients in the ordinary course of our business, making capital expenditures and funding working capital. See “Use of Proceeds.”

Events of Default	Events of default generally will include failure to pay principal, failure to pay interest, failure to observe or perform any other covenant or warranty in the Notes or in the indentures, and certain events of bankruptcy, insolvency or reorganization. See “Description of the Notes — Events of Default.”

Certain Covenants	The indentures that govern the Notes contains certain covenants, including, but not limited to, restrictions on our ability to merge or consolidate with or into any other entity. See “Description of the Notes — Covenants.”

No Financial Covenants	The indentures relating to the Notes do not contain financial covenants.

Additional Notes	We may create and issue additional notes ranking equally and ratably with the 7.375% 2023 Notes, 6.875% 2023 Notes, 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes, in all respects, so that such additional notes will constitute and form a single series with the 7.375% 2023 Notes, 6.875% 2023 Notes, 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes, as applicable, and will have the same terms as to status, redemption or otherwise (except the price to public, the issue date and, if applicable, the initial interest payment date) as such Notes. We will not issue any such additional notes unless such issuance would constitute a “qualified reopening” for U.S. federal income tax purposes.

Defeasance	The Notes are subject to legal and covenant defeasance by us. See “Description of the Notes — Defeasance” for more information.

Listing	The 7.375% 2023 Notes, 6.875% 2023 Notes, 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes, when issued, are or will be quoted on NASDAQ under the symbols “RILYH,” “RILYI,” “RILYO,” “RILYM,” “RILYN,” “RILYG,” and “RILYT,” respectively.

Form and Denomination	The Notes will be issued in book-entry form in minimum denominations of $25 and integral multiples in excess thereof. The Notes will be represented by a permanent global certificate deposited with the trustee as custodian for The Depository Trust Company (“DTC”) and registered in the name of a nominee of DTC. Beneficial interests in any of the Notes will be shown on, and transfers will be effected only through, records maintained by DTC and its direct and indirect participants and any such interest may not be exchanged for certificated securities, except in limited circumstances.

Trustee	U.S. Bank National Association under the 2016 Indenture relating to the 7.375% 2023 Notes, 6.875% 2023 Notes and 2027 Notes. The Bank of New York Mellon Trust Company, N.A. under the 2019 Indenture relating to the 2024 Notes, 2025 Notes, 2026 Notes and 2028 Notes.

Governing Law	The Notes will be and the indentures governing the Notes are governed by the laws of the State of New York.

Series A Depositary Shares and Series A Preferred Stock

Ranking	The Series A Preferred Stock underlying the Series A Depositary Shares will rank, as to dividend rights and rights upon our liquidation, dissolution or winding up:

	(1) Senior to all classes or series of our common stock and to all other equity securities issued by us other than any equity securities issued by us with terms specifically providing that those equity securities rank on a parity with the Series A Preferred Stock;

	(2) Junior to all equity securities issued by us with terms specifically providing that those equity securities rank senior to the Series A Preferred Stock with respect to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up; and

	(3) Effectively junior to all our existing and future indebtedness (including indebtedness convertible into our common stock or preferred stock) and to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) our existing or future subsidiaries.

Dividends	We will pay cumulative cash dividends on the Series A Preferred Stock, when and as declared by our Board of Directors, at the rate of 6.875% of the $25,000.00 liquidation preference ($25.00 per depositary share) per year (equivalent to $1,718.75 or $1.71875 per depositary share).

	Dividends will be payable quarterly in arrears, on or about the last day of January, April, July and October; provided that if any dividend payment date is not a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day, and no interest, additional dividends or other sums will accumulate. Dividends will accumulate and be cumulative from, and including, the date of original issuance. Dividends on the Series A Preferred Stock underlying the Series A Depositary Shares will continue to accumulate whether or not (i) any of our agreements prohibit the current payment of dividends, (ii) we have earnings or funds legally available to pay the dividends, or (iii) our Board of Directors does not declare the payment of the dividends.

Liquidation Preference	The liquidation preference of each share of Series A Preferred Stock is $25,000.00 ($25.00 per depositary share). Upon liquidation, Series A preferred shareholders will be entitled to receive the liquidation preference with respect to their shares of Series A Preferred Stock plus an amount equal to accumulated but unpaid dividends with respect to such shares. See “Description of Series A Preferred Stock and the Series A Depositary Shares — Liquidation Preference” on page S-39 of this prospectus supplement.

Optional Redemption	We may not redeem the Series A Preferred Stock underlying the Series A Depositary Shares prior to October 7, 2024, except as described below under “Special Optional Redemption.” At any time on or after October 7, 2024, we may, at our option, redeem the Series A Preferred Stock, in whole or from time to time in part, by paying $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accumulated and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series A Depositary Shares representing the shares redeemed. We refer to this redemption as an “optional redemption.”

Special Optional Redemption	Upon the occurrence of a Delisting Event (as defined below), we may, at our option, redeem the Series A preferred stock, in whole or in part, within 90 days after the first date on which such Delisting Event occurred, for cash, at a redemption price of $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accrued and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series A Depositary Shares representing the shares redeemed.

	A “Delisting Event” occurs when, after the original issuance of Series A Preferred Stock, both (i) the shares of Series A Preferred Stock (or the Series A Depositary Shares) are no longer listed on the New York Stock Exchange (the “NYSE”), the NYSE American LLC (“NYSE AMER”) or the Nasdaq Stock Market LLC (“NASDAQ”), or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE AMER or NASDAQ, and (ii) we are not subject to the reporting requirements of the Exchange Act, but any Series A Preferred Stock is still outstanding.

	Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series A Preferred Stock underlying the Series A Depositary Shares, in whole or in part within 120 days after the first date on which such Change of Control occurred, for cash, at a redemption price of $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accrued and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series A Depositary Shares representing the shares redeemed.

	A “Change of Control” occurs when, after the original issuance of the Series A Preferred Stock, the following have occurred and are continuing:

	● the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our company entitling that person to exercise more than 50% of the total voting power of all shares of our company entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and

	● following the closing of any transaction referred to in the bullet point above, neither we nor any acquiring or surviving entity (or if, in connection with such transaction shares of our common stock are converted into or exchanged for (in whole or in part) common equity securities of another entity), has a class of common securities (or ADRs representing such securities) listed on the NYSE, the NYSE AMER or NASDAQ, or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE AMER or NASDAQ.

	We refer to redemption following a Delisting Event or Change of Control as a “special optional redemption.” If, prior to the Delisting Event Conversion Date or the Change of Control Conversion Date, as applicable, we have provided or provide notice of exercise of any of our redemption rights relating to the Series A Preferred Stock (whether our optional redemption right or our special optional redemption right), the holders of Series A Depositary Shares representing interests in the Series A Preferred Stock will not have the conversion right described below.

Conversion Rights	Upon the occurrence of a Delisting Event or a Change of Control, as applicable, each holder of Series A Depositary Shares representing interests in the Series A Preferred Stock will have the right (unless, prior to the Delisting Event Conversion Date or Change of Control Conversion Date, as applicable, we have provided or provide notice of our election to redeem the Series A Preferred Stock) to direct the depositary, on such holder’s behalf, to convert some or all of the Series A Preferred Stock underlying the Series A Depositary Shares held by such holder on the Delisting Event Conversion Date or Change of Control Conversion Date, as applicable into a number of shares of our common stock (or equivalent value of alternative consideration) per depositary share equal to the lesser of:

	● the quotient obtained by dividing (1) the sum of the $25.00 per depositary share liquidation preference plus the amount of any accumulated and unpaid dividends to, but not including, the Delisting Event Conversion Date or Change of Control Conversion Date, as applicable (unless the Delisting Event Conversion Date or Change of Control Conversion Date, as applicable is after a record date for a Series A Preferred Stock dividend payment and prior to the corresponding Series A Preferred Stock dividend payment date, in which case no additional amount for such accumulated and unpaid dividend will be included in this sum) by (2) the Common Stock Price (as defined herein); and

	● 2.176 (i.e., the Series A Share Cap), subject to certain adjustments;

	and subject, in each case, to the conditions described in this prospectus supplement and the accompanying prospectus, including, under specified circumstances, an aggregate cap on the total number of shares of our common stock issuable upon conversion and to provisions for the receipt of alternative consideration.

	Because each depositary share represents a 1/1000th interest in a share of the Series A Preferred Stock, the number of shares of common stock ultimately received for each depositary share will be equal to the number of shares of common stock received upon conversion of each share of Series A Preferred Stock divided by 1000. In the event that the conversion would result in the issuance of fractional shares of common stock, we will pay the holder of Series A Depositary Shares cash in lieu of such fractional shares.

	For a definition of “Change of Control Conversion Right”, “Change of Control Conversion Date,” “Common Stock Price,” “Delisting Event Conversion Right,” and “Delisting Event Conversion Date” and for a description of the adjustments and provisions for the receipt of alternative consideration that may be applicable to the Delisting Event Conversion Right or Change of Control Conversion Right described above, see “Description of Series A Preferred Stock and the Depositary Shares — Conversion Rights.”

	Except as provided above in connection with a Delisting Event or Change of Control, shares of the Series A Preferred Stock are not convertible into or exchangeable for any other securities or property.

No Maturity, Sinking Fund or Mandatory Redemption	The Series A Preferred Stock underlying the Series A Depositary Shares does not have any stated maturity date and is not subject to mandatory redemption at the option of the holder or any sinking fund. We are not required to set aside funds to redeem the Series A Preferred Stock. Accordingly, the Series A Preferred Stock and Series A Depositary Shares will remain outstanding indefinitely unless we decide to redeem them pursuant to our optional redemption or special optional redemption rights, or they are converted in connection with a Delisting Event or Change of Control.

Limited Voting Rights	Holders of the Series A Depositary Shares representing interests in the Series A Preferred Stock generally will have no voting rights. However, if we do not pay dividends on any outstanding shares of Series A Preferred Stock for six or more quarterly dividend periods (whether or not declared or consecutive), holders of Series A Depositary Shares representing interests in the Series A Preferred Stock (voting separately as a class with all other outstanding series of preferred stock upon which like voting rights have been conferred and are exercisable) will be entitled to elect two additional directors to our Board of Directors to serve until all unpaid dividends have been fully paid or declared and set apart for payment. In addition, certain material and adverse changes to the terms of the Series A Preferred Stock cannot be made without the affirmative vote of holders of at least 66 ²/₃% of the outstanding shares of Series A Preferred Stock, voting as a separate class. See “Description of Series A Preferred Stock and the Series A Depositary Shares — Limited Voting Rights” beginning on page S-45 of this prospectus supplement. In any matter in which the Series A Preferred Stock may vote, each share of Series A Preferred Stock shall be entitled to one vote. As a result, each depositary share will be entitled to 1/1000th of a vote.

Listing	The Series A Depositary Shares are listed on NASDAQ under the symbol “RILYP.”

Form	The Series A Depositary Shares will be issued and maintained in book-entry form registered in the name of the nominee of The Depository Trust Company, except under limited circumstances.

Depositary	Continental Stock Transfer and Trust Company.

Series B Depositary Shares and Series B Preferred Stock

Ranking	The Series B Preferred Stock underlying the Series B Depositary Shares will rank, as to dividend rights and rights upon our liquidation, dissolution or winding up:

	(1) Senior to all classes or series of our common stock and to all other equity securities issued by us expressly designated as ranking junior to the Series B Preferred Stock;

	(2) On parity with our Series A Preferred Stock;

	(2) Junior to all equity securities issued by us with terms specifically providing that those equity securities rank senior to the Series B Preferred Stock with respect to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up; and

	(3) Effectively junior to all our existing and future indebtedness (including indebtedness convertible into our common stock or preferred stock) and to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) our existing or future subsidiaries.

Dividends	We will pay cumulative cash dividends on the Series B Preferred Stock, when and as declared by our Board of Directors, at the rate of 7.375% of the $25,000.00 liquidation preference ($25.00 per depositary share) per year (equivalent to $1,843.75 or $1.84375 per depositary share).

	Dividends will be payable quarterly in arrears, on or about the last day of January, April, July and October; provided that if any dividend payment date is not a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day, and no interest, additional dividends or other sums will accumulate. Dividends will accumulate and be cumulative from, and including, the date of original issuance. Dividends on the Series B Preferred Stock underlying the Series B Depositary Shares will continue to accumulate whether or not (i) any of our agreements prohibit the current payment of dividends, (ii) we have earnings or funds legally available to pay the dividends, or (iii) our Board of Directors does not declare the payment of the dividends.

Liquidation Preference	The liquidation preference of each share of Series B Preferred Stock is $25,000.00 ($25.00 per depositary share). Upon liquidation, Series B preferred shareholders will be entitled to receive the liquidation preference with respect to their shares of Series B Preferred Stock plus an amount equal to accumulated but unpaid dividends with respect to such shares. See “Description of Series B Preferred Stock and the Series B Depositary Shares — Liquidation Preference” on page S-48 of this prospectus supplement.

Optional Redemption	We may not redeem the Series B Preferred Stock underlying the Series B Depositary Shares prior to September 4, 2025, except as described below under “Special Optional Redemption.” At any time on or after September 4, 2025, we may, at our option, redeem the Series B Preferred Stock, in whole or from time to time in part, by paying $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accumulated and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series B Depositary Shares representing the shares redeemed. We refer to this redemption as an “optional redemption.”

Special Optional Redemption	Upon the occurrence of a Delisting Event (as defined below), we may, at our option, redeem the Series B preferred stock, in whole or in part, within 90 days after the first date on which such Delisting Event occurred, for cash, at a redemption price of $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accrued and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series B Depositary Shares representing the shares redeemed.

	A “Delisting Event” occurs when, after the original issuance of Series B Preferred Stock, both (i) the shares of Series B Preferred Stock (or the Series B Depositary Shares) are no longer listed on the NYSE, the NYSE AMER or the NASDAQ, or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE AMER or NASDAQ, and (ii) we are not subject to the reporting requirements of the Exchange Act, but any Series B Preferred Stock is still outstanding.

	Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series B Preferred Stock underlying the Series B Depositary Shares, in whole or in part within 120 days after the first date on which such Change of Control occurred, for cash, at a redemption price of $25,000.00 per share (equivalent to $25.00 per depositary share), plus any accrued and unpaid dividends to, but not including, the date of redemption, and the depositary will redeem a proportional number of Series B Depositary Shares representing the shares redeemed.

	●	will bear cash interest from the most recent interest payment date immediately preceding the date of issuance of the 2024 Notes at an annual rate of 6.75%, payable quarterly in arrears on January 31, April 30, July 31 and October 31 of each year, except that 2024 Notes purchased after the record dates noted below, but prior to the interest payment date immediately following such record date (or if settlement of a purchase of 2024 Notes otherwise occurs after such record date but prior to the interest payment date immediately following such record date), such 2024 Notes will not begin to accrue interest until the interest payment date immediately following such record date, and the interest payable on each interest payment date will be paid only to holders of record of the 2024 Notes at the close of business on January 15, April 15, July 15 and October 15 of each year, as the case may be, immediately preceding the applicable interest payment date;

	●	will be redeemable at our option, in whole or in part, at any time on and after May 31, 2021, at the price and on the terms described under “—Optional Redemption” below;

	●	Our quarterly report on Form 10-Q for the quarterly periods ended March 31, 2020, June 30, 2020, and September 30, filed with the SEC on May 11, 2020, August 3, 2020 and October 30, 2020, respectively;

	●	Our annual report on Form 10-K for the year December 31, 2019, filed with the SEC on March 10, 2020 and Form 10-K/A filed with the SEC on April 23, 2020;

	●	Our current report on Form 8-K/A filed with the SEC on November 26, 2019, and our current reports on Form 8-K filed with the SEC on November 1, 2019, January 9, 2020, February 10, 2020, February 12, 2020, February 21, 2020, April 13, 2020, May 6, 2020, May 15, 2020, June 24, 2020, September 1, 2020, September 4, 2020, September 14, 2020, October 13, 2020, January 6, 2021, January 11, 2021, January 15, 2021 and January 25, 2021;

	●	Certificate of Designation designating the 6.875% Series A Cumulative Perpetual Preferred Stock filed on October 4, 2019; and

	●	Certificate of Designation designating the 7.375% Series B Cumulative Perpetual Preferred Stock filed on September 3, 2020.

	Amount to be paid
SEC Registration Fee	$	16,365
FINRA Filing Fee			**
Legal Fees and Expenses			**
Accounting Fees and Expenses			**
Transfer Agent, Registrar and Trustee Fees			**
Printing and Engraving Fees			**
Miscellaneous			**
Total	$		**

Exhibit Number		Description
1.1		Form of Underwriting Agreement.**
1.2		At Market Issuance Sales Agreement, dated as of February 14, 2020, by and between B. Riley Financial, Inc. and B. Riley FBR, Inc. (which has been subsequently renamed B. Riley Securities, Inc.) (incorporated by reference to Exhibit 1.2 of the registrant’s Form S-3, filed on February 14, 2020).
2.1		Membership Interest Purchase Agreement, dated as of October 11, 2019 by and among B. Riley Financial, Inc., B. Riley Brand Management LLC, BR Brand Acquisition LLC and BR Brand Holdings LLC (incorporated by reference to Exhibit 2.1 of the registrant’s Current Report on Form 8-K filed with the SEC on November 1, 2019).***
3.1		Amended and Restated Certificate of Incorporation, as amended, dated as of August 17, 2015 (incorporated by reference to Exhibit 3.1 of the registrant’s Current Report on Form 10-Q filed with the SEC on August 3, 2018).
3.2		Amended and Restated Bylaws, dated as of November 6, 2014 (incorporated by reference to Exhibit 3.6 of the registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 6, 2014).
3.3		Amendment to the Amended and Restated Bylaws, dated as of April 3, 2019 (incorporated by reference to Exhibit 3.1 of the registrant’s Current Report on Form 8-K filed with the SEC on April 9, 2019).
3.4		Certificate of Designation designating the 6.875% Series A Cumulative Perpetual Preferred Stock (incorporated by reference to Exhibit 3.1 on the registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019).
3.5		Certificate of Designation designating the 7.375% Series B Cumulative Perpetual Preferred Stock (incorporated by reference to Exhibit 3.1 on the registrant’s Current Report on Form 8-K filed with the SEC on September 4, 2020).
4.1		Form of Common Stock Certificate (Incorporated by reference to Exhibit 4.1 of the registrant’s Annual Report on Form 10-K filed with the SEC on March 30, 2015).
4.2		Form of Warrant Agreement (including form of warrant).**
4.3		Form of Unit Agreement (including form of unit certificate).**
4.4		Form of Certificate of Designation with respect to shares of Preferred Stock.**
4.5		Form of Deposit Agreement (including form of Depositary Receipt).**
4.6		Form of Indenture for Subordinated Debt Securities.*
4.7		Form of Senior Note.**
4.8		Form of Subordinated Note.**
4.9		Indenture, dated as of November 2, 2016, between B. Riley Financial, Inc. and U.S. Bank National Association, as Trustee for Senior Debt Securities (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed by the registrant with the SEC on November 2, 2016) (the “2016 Indenture”).

4.10		Third Supplemental Indenture, dated as of December 13, 2017, by and between B. Riley Financial, Inc. and U.S. Bank National Association, as Trustee (including Form of 7.25% Senior Note due 2027) (incorporated by reference to Exhibit 4.1 of the registrant’s Current Report on Form 8-K filed with the SEC on December 13, 2017).
4.11		Fourth Supplemental Indenture, dated as of May 17, 2018, by and between B. Riley Financial, Inc. and U.S. Bank National Association, as Trustee (including Form of 7.375% Senior Note due 2023) (incorporated by reference to Exhibit 4.1 of the registrant’s Current Report on Form 8-K filed with the SEC on May 17, 2018).
4.12		Fifth Supplemental Indenture, dated as of September 11, 2018, by and between B. Riley Financial, Inc. and U.S. Bank National Association, as Trustee (including Form of 6.875% Senior Note due 2023) (incorporated by reference to Exhibit 4.1 of the registrant’s Current Report on Form 8-K filed with the SEC on September 11, 2018).
4.13		Indenture, dated as of May 7, 2019, between B. Riley Financial, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee, for Senior Debt Securities (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed by the registrant with the SEC on May 7, 2019) (the “2019 Indenture”).
4.14		First Supplemental Indenture, dated as of May 7, 2019, between B. Riley Financial, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee (including Form of 6.75% Senior Note due 2024) (incorporated by reference to Exhibit 4.2 of the registrant’s Current Report on Form 8-K filed with the SEC on May 7, 2019).
4.15		Second Supplemental Indenture, dated as of September 23, 2019, between B. Riley Financial, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee (including Form of 6.50% Senior Note due 2026) (incorporated by reference to Exhibit 4.3 of the registrant’s Current Report on Form 8-K filed with the SEC on September 23, 2019).
4.16		Third Supplemental Indenture, dated as of February 12, 2020, between B. Riley Financial, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee (including Form of 6.375% Senior Note due 2025) (incorporated by reference to Exhibit 4.4 of the registrant’s Current Report on Form 8-K filed with the SEC on February 12, 2020).
4.17		Fourth Supplemental Indenture, dated as of January 25, 2021, between B. Riley Financial, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee (including Form of 6.00% Senior Note due 2028) (incorporated by reference to Exhibit 4.5 of the registrant’s Current Report on Form 8-K filed with the SEC on January 25, 2021).
4.18		Deposit Agreement, dated October 7, 2019, among B. Riley Financial, Inc., Continental Stock Transfer & Trust Company, as Depositary, and the holders of depositary receipts, with respect to B. Riley Financial, Inc.’s 6.875% Series A Cumulative Perpetual Preferred Stock (incorporated by reference to Exhibit 4.1 on the registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019).
4.19		Form of Depositary Receipt (incorporated by reference to Exhibit 4.1 on the registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019).
4.20		Form of Specimen Certificate representing the 6.875% Series A Cumulative Perpetual Preferred Stock, par value $0.0001 per share (incorporated by reference to Exhibit 4.2 on the registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019).
4.21		Deposit Agreement, dated September 4, 2020, among B. Riley Financial, Inc., Continental Stock Transfer & Trust Company, as Depositary, and the holders of depositary receipts, with respect to B. Riley Financial, Inc.’s 7.375% Series B Cumulative Perpetual Preferred Stock (incorporated by reference to Exhibit 4.1 on the registrant’s Current Report on Form 8-K filed with the SEC on September 4, 2020).
4.22		Form of Depositary Receipt (incorporated by reference to Exhibit 4.3 on the registrant’s Current Report on Form 8-K filed with the SEC on September 4, 2020).
4.23		Form of Specimen Certificate representing the 7.375% Series B Cumulative Perpetual Preferred Stock, par value $0.0001 per share (incorporated by reference to Exhibit 4.2 on the registrant’s Current Report on Form 8-K filed with the SEC on September 4, 2020).
5.1		Opinion of The NBD Group, Inc. regarding the legality of the securities being registered.*
23.1		Consent of Marcum LLP.*
23.2		Consent of Mayer Hoffman McCann CPAs, The New York Practice of Mayer Hoffman McCann P.C., Independent Auditor of BR Brand Group.*
23.3		Consent of The NBD Group, Inc. (included in Exhibit 5.1).*
24		Powers of Attorney of directors and certain officers of the registrant (included on signature page).*
25.1		Statement of Eligibility on Form T-1 of The Bank of New York Mellon Trust Company, N.A. related to the 2019 Indenture for Senior Debt Securities.*
25.2		Statement of Eligibility on Form T-1 of The Bank of New York Mellon Trust Company, N.A. related to Indenture for Subordinated Debt Securities.*
25.3		Statement of Eligibility on Form T-1 of U.S. Bank National Association related to the 2016 Indenture for Senior Debt Securities.*

	B. RILEY FINANCIAL, INC.

	By:	/s/ Phillip J. Ahn
	Name:	Phillip J. Ahn
	Title:	Chief Financial Officer and Chief Operating Officer

SIGNATURE	TITLE	DATE

/s/ Bryant R. Riley	Co-Chief Executive Officer and Chairman of the Board	January 28, 2021
Bryant R. Riley	(Principal Executive Officer)

/s/ Phillip J. Ahn	Chief Financial Officer and Chief Operating Officer	January 28, 2021
Phillip J. Ahn	(Principal Financial Officer)

/s/ Howard E. Weitzman	Chief Accounting Officer	January 28, 2021
Howard E. Weitzman	(Principal Accounting Officer)

/s/ Thomas J. Kelleher	Co-Chief Executive Officer and Director	January 28, 2021
Thomas J. Kelleher

/s/ Robert L. Antin	Director	January 28, 2021
Robert L. Antin

/s/ Robert D’Agostino	Director	January 28, 2021
Robert D’Agostino

/s/ Randall Paulson	Director	January 28, 2021
Randall Paulson

/s/ Michael J. Sheldon	Director	January 28, 2021
Michael J. Sheldon

/s/ Mimi Walters	Director	January 28, 2021
Mimi Walters

/s/ Mikel H. Williams	Director	January 28, 2021
Mikel H. Williams