Company: RILYN
Filing Date: 2025-09-19
Form Type: 10-K
Source: 0001464790-25-000011
Chunk: 237

Company: B. Riley Financial, Inc.
Filing Date: 2025-09-19
Form: 10-K
Item: Item 7
Chunk 237
---
 the operational performance of Freedom VCM Holdings, LLC’s various business segments. The investment in Freedom VCM Holdings, LLC 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.

Recent Developments

Conn’s and FRG

The Company’s results during the year ended December 31, 2024 were negatively impacted by a significant non-cash markdown of $287.0 million related to its investment in Freedom VCM, the indirect parent entity for FRG. Freedom VCM’s strategy, which included the potential divestiture or monetization of certain assets, was materially negatively impacted by the unexpected announcement in November 2023 concerning FRG’s former CEO and his alleged involvement in fraudulent schemes despite the fact that these allegations are unrelated to FRG and its businesses. In the meantime, the consumer facing portion of the U.S. economy has deteriorated. On November 3, 2024, FRG, its operating businesses, and certain other affiliates, including Freedom VCM, filed the FRG Chapter 11 Cases under chapter 11 of the Bankruptcy Code in the Bankruptcy Court. As a result, on November 4, 2024, we concluded that we were required to record an impairment (in addition to prior impairments) with respect to the Freedom VCM Investment and the Vintage Loan Receivable. The additional non-cash impairments of the Freedom VCM Investment and the Vintage Loan Receivable are $118.0 million in the aggregate as of November 4, 2024. As a result of such additional impairments, we have ascribed no value to the Freedom VCM Investment and the Vintage Loan Receivable was valued at $2.1 million at December 31, 2024, which approximates the fair value of the underlying collateral for this loan which is primarily comprised of other securities. Subsequent to December 31, 2024, the fair value of the underlying collateral for this loan, which is comprised of other public securities, decreased to a fair value of $1.3 million at September 16, 2025.

Additionally, on July 23, 2024, Conn’s and certain of its subsidiaries filed the Chapter 11 Cases under chapter 11 of the Bankruptcy Code in the Bankruptcy Court. FRG, pursuant to a transaction consummated in January 2024, acquired a substantial equity investment in Conn’s in exchange for the sale of