Company: RILYN
Filing Date: 2025-02-21
Form Type: 10-Q
Source: 0001628280-25-007082
Chunk: 186

Company: B. Riley Financial, Inc.
Filing Date: 2025-02-21
Form: 10-Q
Item: Part I, Item 2
Chunk 186
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6.3 million as compared to $3.8 million and $57.8 million during the three and nine months ended September 30, 2023.  

During the three and nine months ended September 30, 2024, fair value adjustments for the loan receivable for Vintage Capital Management, LLC was $(54.3) million and $(222.7) million, respectively. The fair value adjustments are related primarily to the decline in the equity fair value of Freedom VCM Holdings, LLC (“Freedom VCM”) which, along with certain guarantees, is the primary collateral for this loan. The decline in the equity fair value of Freedom VCM is due to increases in net debt, a decrease in the operational performance of Freedom VCM various business units during 2024, and a  decline in the equity value of Freedom VCM’s investment in Conn’s, Inc. common stock which was impacted by Conn’s Inc. voluntary petition filing on July 23, 2024 for relief (the “Chapter 11 Cases”) under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). Subsequent to September 30, 2024, the collateral value for the VCM loan receivable was also impacted due to the filing of Freedom VCM’s voluntary petitions for relief under Chapter 11 of the Bankruptcy Code on November 3, 2024. These factors resulted in a decrease in the fair value of the Freedom VCM loan receivable to $2.3 million at September 30, 2024.

During the three and nine months ended September 30, 2024, we recorded $0.5 million and $(13.2) million of fair value adjustments to the loan receivable for Freedom VCM Receivables, Inc.. The fair value adjustment of $(13.2) million during the nine months ended September 30, 2024 was primarily due to a fair value adjustment of $12.0 million recorded in the second quarter of 2024 resulting from higher projected charge offs of receivables on the consumer receivable portfolio that are serviced by Conn's, Inc. which was impacted by Conn’s voluntary petition filing on July 23, 2024 for relief (the “Chapter 11 Cases”) under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for