Company: RILY
Filing Date: 2025-12-15
Form Type: 10-Q
Source: 0001464790-25-000029
Chunk: 102

Company: B. Riley Financial, Inc.
Filing Date: 2025-12-15
Form: 10-Q
Item: Part I, Item 1
Chunk 102
---
 market and credit risk, primarily in the event that, for any reason, securities purchased by the Company cannot be distributed at the anticipated price and to balance sheet risk in the event that debt or equity financing commitments cannot be syndicated.The Company is party to a purchase agreement with a public company (the “Issuer”) under which the Issuer may require the Company to purchase the Issuer’s convertible preferred stock prior to April 30, 2028. If exercised, the Company would remit $25,000 in cash and receive preferred shares at a discount to their stated value, with the preferred stock convertible at the Company’s option into common shares of the Issuer based on a formula tied to market prices. The preferred stock also includes a contingent redemption feature if the Issuer’s common stock declines below a specified price threshold. As of June 30, 2025, the $25,000 commitment remained outstanding and had not been exercised by the Issuer, and no amounts were due. The Company purchased the $25,000 of preferred shares from the Issuer on July 15, 2025.

65

NOTE 18 — SHARE-BASED PAYMENTS

(a) Employee Stock Incentive PlansUnder the 2021 B. Riley Stock Incentive Plan (the “2021 Plan”), share-based compensation expense for restricted stock units under the Company’s 2021 Plan was:Three Months EndedJune 30,Six Months EndedJune 30,2025202420252024Share-based compensation expense for restricted stock units for continuing operations$2,649 $5,318 $5,658 $12,859 Share-based compensation expense for restricted stock units for discontinued operations822 724 1,038 1,557 Total share-based compensation expense for restricted stock units$3,471 $6,042 $6,696 $14,416 During the six months ended June 30, 2025, in connection with employee stock incentive plans, the Company did not grant any restricted stock units. Share based compensation expense is recorded in the “Selling, general and administrative expenses” line item in the unaudited condensed consolidated statement of operations. The Company began settling equity-classified restricted stock units in cash and as a result of the past practice, the restricted stock units were reclassified to a liability in January of 2025. The change in classification was accounted for as a modification under ASC 718, Compensation - Stock Compensation. The grant date fair value of the original