What changed in this filing

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Item 1. Financial Statements

2026-08-06 compared with 2026-05-07 · 716 added, 428 removed, 1275 unchanged (47% of the section changed)

34 unchanged sentences

Operating lease liabilities 46,307 40,902

Revolving credit facility 10,708 6,638

Revolving credit facilities 31,316 6,638

Term loans, net 115,770 119,297

20 unchanged sentences

Total liabilities and equity (deficit) $ 1,967,538 $ 1,706,592

(1) At March 31, 2026 and December 31, 2025 the balance sheet includes cash of $ 519 and $ 446 , securities and other investments owned, at fair value of $ 723 and $ 682 , prepaid and other expenses of $ 3,704 and $ 3,737 , accrued expenses and other liabilities of $ 28 and $ 28 , and noncontrolling interest of $ 4,261 and $ 4,192 , respectively, of consolidated variable interest entities (see Note 3 - Variable Interest Entities).

(1) At June 30, 2026 and December 31, 2025 the balance sheet includes cash of $ 183 and $ 446 , securities and other investments owned, at fair value of $ 713 and $ 682 , prepaid and other expenses of $ 3,678 and $ 3,737 , accrued expenses and other liabilities of $ 28 and $ 28 , and noncontrolling interest of $ 3,939 and $ 4,192 , respectively, of consolidated variable interest entities (see Note 3 - Variable Interest Entities).

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3 unchanged sentences

Three Months Ended

Services and fees ($ 5,923 and $ 3,945 from related parties)

June 30, Six Months Ended

2026 2025 2026 2025

Trading gains (losses), net 145,061 ( 16,171 )

Fair value adjustments on loans ($( 26 ) and $( 2,146 ) from related parties)

Services and fees ($ 6,976 and $ 5,121 for the three months and $ 12,899 and $ 7,849 for the six months ended June 30, 2026 and 2025 from related parties, respectively)

$ 173,595 $ 145,772 $ 325,717 $ 304,611

Interest income - loans ($ — and $ 696 from related parties)

Trading gains, net 12,874 27,680 157,935 11,509

Fair value adjustments on loans ($ 82 and $( 992 ) for the three months and $ 56 and $( 3,137 ) for the six months ended June 30, 2026 and 2025 from related parties, respectively)

4,245 800 10,790 ( 7,296 )

Interest income - loans ($ — and $ 475 for the three months and $ — and $ 1,171 for the six months ended June 30, 2026 and 2025 from related parties, respectively)

2,171 3,853 3,885 7,049

Interest income - securities lending 1,632 2,124 2,883 2,964

5 unchanged sentences

Selling, general and administrative expenses 133,377 142,369 267,725 309,757

Restructuring charge (Note 18) 1,914 321 1,914 321

Impairment of tradename 4,000 1,500 4,000 1,500

Interest expense - Securities lending and loan participations sold 906 1,968 1,623 2,687

8 unchanged sentences

Gain on senior note exchange — 44,454 — 54,986

Income (loss) from equity investments 1,326 ( 552 )

Gain (loss) on extinguishment of debt 2,890 ( 10,427 )

(Loss) income from equity investments ( 5,459 ) 25,603 ( 4,133 ) 25,051

(Loss) gain on extinguishment of debt ( 1,283 ) ( 10,266 ) 1,607 ( 20,693 )

Interest expense ( 18,016 ) ( 23,952 ) ( 37,810 ) ( 53,916 )

Income (loss) from continuing operations before income taxes 239,050 ( 23,004 )

(Provision for) benefit from income taxes ( 16,891 ) 3,042

Income (loss) from continuing operations 222,159 ( 19,962 )

Income from continuing operations before income taxes 27,547 74,740 266,597 51,736

Provision for income taxes ( 5,950 ) ( 3,053 ) ( 22,841 ) ( 11 )

Income from continuing operations 21,597 71,687 243,756 51,725

Income from discontinued operations, net of income taxes — 69,312 — 72,707

Net income (loss) 222,159 ( 16,567 )

Net income 21,597 140,999 243,756 124,432

Net income (loss) attributable to noncontrolling interests 1,048 1,528 9,934 ( 5,064 )

Net income (loss) attributable to BRC Group Holdings, Inc.

Net income attributable to BRC Group Holdings, Inc.

20,549 139,471 233,822 129,496

Preferred stock dividends 2,015 2,015 4,030 4,030

Net income (loss) available to common shareholders $ 211,258 $ ( 11,990 )

Basic net income (loss) per common share:

Net income available to common shareholders $ 18,534 $ 137,456 $ 229,792 $ 125,466

Basic net income per common share:

Continuing operations $ 0.49 $ 2.23 $ 6.59 $ 1.73

Discontinued operations — 2.27 — 2.38

Basic income (loss) per common share $ 6.62 $ ( 0.39 )

Diluted net income (loss) per common share:

Basic income per common share $ 0.49 $ 4.50 $ 6.59 $ 4.11

Diluted net income per common share:

Continuing operations $ 0.45 $ 2.23 $ 6.47 $ 1.73

Discontinued operations — 2.27 — 2.38

Diluted income (loss) per common share $ 6.57 $ ( 0.39 )

Diluted income per common share $ 0.45 $ 4.50 $ 6.47 $ 4.11

Weighted average basic common shares outstanding 37,811,031 30,527,835 34,879,728 30,512,757

5 unchanged sentences

Three Months Ended

Net income (loss) $ 222,159 $ ( 16,567 )

June 30, Six Months Ended

2026 2025 2026 2025

Net income $ 21,597 $ 140,999 $ 243,756 $ 124,432

Other comprehensive income (loss):

Change in cumulative translation adjustment ( 1,319 ) 1,158 ( 2,196 ) 671

Other comprehensive loss, net of tax ( 877 ) ( 487 )

Total comprehensive income (loss) 221,282 ( 17,054 )

Other comprehensive (loss) income, net of tax ( 1,319 ) 1,158 ( 2,196 ) 671

Total comprehensive income 20,278 142,157 241,560 125,103

Comprehensive income (loss) attributable to noncontrolling interests 1,048 1,528 9,934 ( 5,064 )

Comprehensive income (loss) attributable to BRC Group Holdings, Inc.

Comprehensive income attributable to BRC Group Holdings, Inc.

$ 19,230 $ 140,629 $ 231,626 $ 130,167

3 unchanged sentences

(Dollars in thousands, except share and per share data)

For the Three Months Ended March 31, 2026 and 2025

For the Three Months Ended June 30, 2026 and 2025

Preferred Stock Common Stock Additional

4 unchanged sentences

Shares Amount Shares Amount

Balance, April 1, 2026 4,563 $ — 35,150,932 $ 4 $ 634,479 $ ( 550,013 ) $ ( 7,149 ) $ 59,011 $ 136,332

Common stock issued, in connection with redemption of Senior Notes — — 3,804,629 — 34,284 — — — 34,284

Common stock issued, in connection with the exercise of warrants — — 915,251 — 9,400 — — — 9,400

Vesting of restricted stock, net of shares withheld for employer taxes — — 328,943 — ( 929 ) — — — ( 929 )

Share-based payments — — — — 2,863 — — — 2,863

Share-based payments in equity of subsidiary — — — — — — — 365 365

Net income — — — — — 20,549 — 1,048 21,597

Distributions to noncontrolling interests and other — — — — — — — ( 1,358 ) ( 1,358 )

Other comprehensive loss — — — — — — ( 1,319 ) — ( 1,319 )

Balance, June 30, 2026

4,563 $ — 40,199,755 $ 4 $ 680,097 $ ( 529,464 ) $ ( 8,468 ) $ 59,066 $ 201,235

Balance, April 1, 2025 4,563 $ — 30,497,066 $ 3 $ 591,207 $ ( 1,080,971 ) $ ( 7,056 ) $ 42,847 $ ( 453,970 )

Common stock issued, in connection with employment agreement — — 100,000 — 295 — — — 295

Warrants issued — — — — 737 — — — 737

Share-based payments — — — — 3,193 — — — 3,193

Share-based payments in equity of subsidiary — — — — — — — 1,277 1,277

Dividend forfeitures on unvested equity awards — — — — — 257 — — 257

Net income — — — — — 139,471 — 1,528 140,999

Distributions to noncontrolling interests — — — — — — — ( 3,249 ) ( 3,249 )

Other comprehensive income — — — — — — 1,158 — 1,158

Balance, June 30, 2025

4,563 $ — 30,597,066 $ 3 $ 595,432 $ ( 941,243 ) $ ( 5,898 ) $ 42,403 $ ( 309,303 )

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

For the Six Months Ended June 30, 2026 and 2025

Preferred Stock Common Stock Additional

Capital Accumulated Deficit Accumulated

Comprehensive

Income (Loss) Noncontrolling

Interests Total

Equity (Deficit)

Shares Amount Shares Amount

Balance, January 1, 2026 4,563 $ — 30,597,066 $ 3 $ 598,022 $ ( 763,286 ) $ ( 6,272 ) $ 51,271 $ ( 120,262 )

Common stock issued, in connection with redemption of Senior Notes — — 8,358,495 1 67,784 — — — 67,785

Common stock issued, in connection with the exercise of warrants — — 915,251 — 9,400 — — — 9,400

RSU equity awards reclassified from liability — — — — 2,589 — — — 2,589

Vesting of restricted stock, net of shares withheld for employer taxes — — 328,943 — ( 929 ) — — — ( 929 )

Share-based payments — — — — 3,231 — — — 3,231

2 unchanged sentences

Net income — — — — — 233,822 — 9,934 243,756

Distributions to noncontrolling interests and other — — — — — — — ( 1,358 ) ( 1,358 )

Other comprehensive loss — — — — — — ( 2,196 ) — ( 2,196 )

Balance, March 31, 2026

Balance, June 30, 2026

4,563 $ — 40,199,755 $ 4 $ 680,097 $ ( 529,464 ) $ ( 8,468 ) $ 59,066 $ 201,235

Balance, January 1, 2025 4,563 $ — 30,499,931 $ 3 $ 589,387 $ ( 1,070,996 ) $ ( 6,569 ) $ 32,159 $ ( 456,016 )

Common stock issued, in connection with employment agreement — — 100,000 — 295 — — — 295

RSU equity awards reclassified to liability — — — — ( 2,138 ) — — — ( 2,138 )

4 unchanged sentences

Vesting of shares in equity of subsidiary — — — — ( 71 ) — — — ( 71 )

Net loss — — — — — ( 9,975 ) — ( 6,592 ) ( 16,567 )

Dividend forfeitures on unvested equity awards — — — — — 257 — — 257

Net income (loss) — — — — — 129,496 — ( 5,064 ) 124,432

Distributions to noncontrolling interests — — — — — — — ( 3,249 ) ( 3,249 )

Common stock issuance in equity of subsidiary — — — — — — — 1,575 1,575

Disposition from sale and deconsolidation of

businesses — — — — — — — 2,918 2,918

Disposition from sale and deconsolidation of businesses — — — — — — — 2,918 2,918

Initial consolidation of VIE — — — — — — — 12,494 12,494

Other comprehensive loss — — — — — — ( 487 ) — ( 487 )

Balance, March 31, 2025

Other comprehensive income — — — — — — 671 — 671

Balance, June 30, 2025

4,563 $ — 30,597,066 $ 3 $ 595,432 $ ( 941,243 ) $ ( 5,898 ) $ 42,403 $ ( 309,303 )

3 unchanged sentences

(Dollars in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities (1) :

Net income (loss) $ 222,159 $ ( 16,567 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Net income $ 243,756 $ 124,432

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation and amortization 15,137 18,798

3 unchanged sentences

( 6,461 ) ( 6,789 )

Non-cash interest and other

Non-cash interest and other (includes $ — and $( 268 ) from related parties)

Depreciation of rental merchandise 6,094 6,698

Net foreign currency losses (gains) 18 ( 481 )

(Income) loss from equity investments ( 1,326 ) 552

Loss (income) from equity investments 4,133 ( 25,051 )

Dividends from equity investments 273 122

Deferred income taxes 502 9,100

Impairment of tradename 4,000 1,500

Gain on disposal of discontinued operations — ( 66,795 )

Loss (gain) on sale or disposal of fixed assets and other 143 ( 1,147 )

13 unchanged sentences

Securities loaned 91,871 26,402

Net cash provided by operating activities 38,073 184

Net cash provided by (used in) operating activities 19,883 ( 25,375 )

Cash flows from investing activities (1) :

11 unchanged sentences

Consolidation of VIE — 359

Net cash provided by investing activities 8,333 59,181

Proceeds from sale of discontinued operations, net of cash sold — 114,032

Net cash (used in) provided by investing activities ( 820 ) 289,220

Cash flows from financing activities (1) :

Proceeds from revolving line of credit 41,312 21,535

Repayment of revolving line of credit ( 37,242 ) ( 24,064 )

Proceeds from revolving lines of credit 108,077 46,374

Repayment of revolving lines of credit ( 83,399 ) ( 50,627 )

Proceeds from note payable — 850

2 unchanged sentences

Proceeds from term loans — 235,550

Redemption of senior notes ( 95,991 ) ( 145,302 )

Proceeds from senior notes held at redemption 5,397 —

Redemption of senior notes, net ( 90,594 ) ( 145,302 )

Repurchases and payments on senior notes ( 13,122 ) —

1 unchanged sentence

Payment of contingent consideration — ( 1,376 )

Payment of employment taxes on vesting of shares in equity of subsidiary ( 1,902 ) —

Payment of employment taxes on vesting of restricted stock ( 2,831 ) —

Distributions to noncontrolling interests ( 1,358 ) ( 3,249 )

Net cash used in financing activities ( 90,510 ) ( 252,424 )

Decrease in cash, cash equivalents and restricted cash (1)

(Decrease) increase in cash, cash equivalents and restricted cash (1)

( 71,447 ) 11,421

1 unchanged sentence

( 2,188 ) 546

Net decrease in cash, cash equivalents and restricted cash (1)

Net (decrease) increase in cash, cash equivalents and restricted cash (1)

( 73,635 ) 11,967

5 unchanged sentences

Cash, cash equivalents and restricted cash, end of period $ 155,642 $ 268,643

Reconciliation of cash, cash equivalents and restricted cash to amounts reported in the condensed consolidated balance sheets:

Cash and cash equivalents $ 154,112 $ 267,388

Restricted cash 1,530 1,255

Total cash, cash equivalents and restricted cash $ 155,642 $ 268,643

Supplemental disclosure of cash flow information:

5 unchanged sentences

Issuance of warrants for term loan — 7,860

Remaining accrued exit fee for term loan — 224

Recognition of derivative liability for term loan springing maturity 797 —

Recognition of derivative liability for term loan exit fee — 11,244

3 unchanged sentences

Reclassification of restricted stock units from equity to liability — 2,138

Issuance of common stock in connection with retirement of senior notes 33,501 —

Issuance of common stock in connection with redemption of senior notes 67,785 —

Issuance of warrants for senior notes — 1,600

Settlement of warrant liability upon cashless exercise 9,400 —

Exchange of preferred stock investment for loan receivable 1,198 —

(1) Amounts presented contain results from both continuing and discontinued operations.

18 unchanged sentences

Liquidity and Capital Resources

During the three months ended March 31, 2026, the Company generated net income of $ 222,159 .

During the three months ended March 31, 2026, the Company fully redeemed the $ 95,991 of outstanding 5.50 % Senior Notes due 2026 on March 30, 2026.

As discussed in more detail in Note 15 - Senior Notes Payable, during the three months ended March 31, 2026, the Company completed a series of exchanges in accordance with Section 3(a)(9) of the Securities Act of 1933 (“Section 3(a)(9) Exchanges”) with DBA Trading, LLC (the “Investor”) whereby the Company exchanged an aggregate principal amount of $ 36,089 of senior notes which included (i) $ 11,002 of the 5.50 % Senior Notes due March 31, 2026, (ii) $ 11,354 of the 6.50 % Senior Notes due September 30, 2026, (iii) $ 2,683 of the 5.00 % Senior Notes due December 31, 2026, (iv) $ 5,625 of the 6.00 % Senior Notes due January 31, 2028, and (v) $ 5,425 of the 5.25 % Senior Notes due August 31, 2028 for an aggregate of 4,553,866 shares of the Company’s common stock.

For the six months ended June 30, 2026, the Company generated net income of $ 243,756 .

During the six months ended June 30, 2026, the Company fully redeemed the $ 95,991 of outstanding 5.50 % Senior Notes due 2026 on March 30, 2026.

As discussed in more detail in Note 15 - Senior Notes Payable, during the six months ended June 30, 2026, the Company completed a series of exchanges in accordance with Section 3(a)(9) of the Securities Act of 1933 (“Section 3(a)(9) Exchanges”) with DBA Trading, LLC (the “Investor”) whereby the Company exchanged an aggregate principal amount of $ 69,054 of senior notes which included (i) $ 11,002 of the 5.50 % Senior Notes which were due March 31, 2026, (ii) $ 36,133 of the 6.50 % Senior Notes due September 30, 2026, (iii) $ 8,945 of the 5.00 % Senior Notes due December 31, 2026, (iv) $ 6,383 of the 6.00 % Senior Notes due January 31, 2028, and (v) $ 6,591 of the 5.25 % Senior Notes due August 31, 2028 for an aggregate of 8,358,495 shares of the Company’s common stock.

The Investor owns more than five percent of the Company’s common stock.

4 unchanged sentences

The unaudited condensed consolidated financial statements include the accounts of BRC Group Holdings, Inc.

and its wholly owned and majority-owned subsidiaries and have been prepared in accordance with accounting principles generally

accepted in the United States of America (“GAAP”).

and its wholly owned and majority-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

All intercompany accounts and transactions have been eliminated upon consolidation.

19 unchanged sentences

Revenues in the Consumer Products segment are primarily generated in the United States, Canada, and Europe.

A significant portion of Lingo’s revenues consists of reselling legacy Plain Old Telephone (“POT”) services copper lines from four major nationwide Incumbent Local Exchange Carriers (“ILECs”) to its customers.

As ILECs have been decommissioning POT lines and halting new POT services, there is a concentration of risk related to Lingo’s ability to attract new POT service customers which adversely affects Lingo’s financial condition, results of operations, and cash flows.

To mitigate this, Lingo has made concerted efforts to transition POT services customers to alternative solutions offered by Lingo.

A significant portion of Lingo’s revenues consists of reselling legacy Plain Old Telephone Services (“POTS”) copper lines from four major nationwide Incumbent Local Exchange Carriers (“ILECs”) to its customers.

As ILECs have been decommissioning POTS lines and halting new POTS, there is a concentration of risk related to Lingo’s ability to attract new POTS customers which adversely affects Lingo’s financial condition, results of operations, and cash flows.

To mitigate this, Lingo has made concerted efforts to transition POTS customers to alternative solutions offered by Lingo.

The Company maintains cash in various federally insured banking institutions.

The account balances at each institution periodically exceed the Federal Deposit Insurance Corporation’s (“FDIC”) insurance coverage, and as a result, there is a concentration of credit risk related to amounts in excess of FDIC insurance coverage.

The account balances at each institution periodically exceed the Federal Deposit Insurance Corporation’s (“FDIC”) insurance coverage, and as a result, there is a

concentration of credit risk related to amounts in excess of FDIC insurance coverage.

The Company has not experienced any losses in such accounts and mitigates this risk by utilizing financial institutions of high credit quality.

At March 31, 2026, the Company also has a concentration in loans receivable at fair value that includes two loans in the amount of $ 21,825 or 87.6 % of total loans receivable to one company (see Note 9 - Loans Receivable, at Fair Value) and securities and other investments owned that includes one investment in the amount of $ 403,189 or 63.0 % of total

securities and other investments owned (see Note 6 - Securities And Other Investments Owned And Securities Sold Not Yet Purchased).

At June 30, 2026, the Company had concentrations in loans receivable at fair value that includes two loans to XBP Americas, LLC totaling $ 15,041 , or 38.8 % of total loans receivable, and one loan to Enovum NC-1 Venture, LLC, a subsidiary of a public AI Infrastructure company, totaling $ 19,794 , or 51.0 % of total loans receivable (see Note 9 - Loans Receivable, at Fair Value).

Additionally, the Company had a concentration in securities and other investments owned at June 30, 2026 that includes investments in two publicly traded companies individually in the amounts of $ 386,996 or 53.5 % and $ 80,040 or 11.1 % of total securities and other investments owned (see Note 6 - Securities And Other Investments Owned And Securities Sold Not Yet Purchased).

(d) Cash and Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

As of March 31, 2026 and December 31, 2025, restricted cash primarily consisted of cash held in escrow and cash collateral for leases and loans, which included amounts subject to Deposit Account Control Agreements with lenders in which the Company assigned the rights to the collateral accounts to the lenders.

As of June 30, 2026 and December 31, 2025, restricted cash primarily consisted of cash held in escrow and cash collateral for leases and loans, which included amounts subject to Deposit Account Control Agreements with lenders in which the Company assigned the rights to the collateral accounts to the lenders.

(e) Variable Interest Entities

25 unchanged sentences

The Company also holds loans receivable valued at fair value, nonpublic common and preferred stocks and warrants for which there is little or no public market and fair value is determined by management on a consistent basis.

various factors including earnings history, financial condition, recent sales prices of the issuer’s securities and liquidity risks.

For investments where little or no public market exists, management’s determination of fair value is based on the best available information which may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration various factors including earnings history, financial condition, recent sales prices of the issuer’s securities and liquidity risks.

These investments are included in Level 3 of the fair value hierarchy.

21 unchanged sentences

The Company has recorded this obligation on its unaudited condensed consolidated balance sheets at the fair value of the securities borrowed.

There is an element of off-balance sheet risk in that, if the securities sold short increase in value, it will be necessary to purchase the securities sold short at a cost in excess of the obligation reflected on the accompanying unaudited condensed consolidated balance sheets.

balance sheets.

Changes in the fair value of securities sold short are recognized in the results of operations in the period in which they occur.

1 unchanged sentence

For these investments the Company has elected to apply the measurement alternative under which they are measured at cost and adjusted for observable price changes and impairments.

Observable price changes result from, among other things, equity transactions for the same issuer executed during the reporting period, including

subsequent equity offerings or other reported equity transactions related to the same issuer.

Observable price changes result from, among other things, equity transactions for the same issuer executed during the reporting period, including subsequent equity offerings or other reported equity transactions related to the same issuer.

For these transactions to be considered observable price changes of the same issuer, the Company evaluates whether these transactions have similar rights and obligations, including voting rights, distribution preferences, conversion rights, and other factors, to the investments the Company holds.

25 unchanged sentences

The ability to exercise significant influence is presumed when the Company possesses more than 20% of the voting interests of the investee.

However, the Company may have the ability to exercise significant influence over the investee when the Company owns less than 20% of the voting interests of the investee depending on the facts and circumstances that demonstrate that the ability to exercise influence is present, such as when the Company has representation on the board of directors of such investee.

representation on the board of directors of such investee.

Equity investments that are accounted for under the equity method of accounting are included in the “Equity investments” line item in the accompanying unaudited condensed consolidated balance sheets.

1 unchanged sentence

The investments are evaluated for impairment annually and when facts and circumstances indicate that the carrying value may not be recoverable.

If a decline in fair value below the carrying value is determined to be not

recoverable, an impairment charge is recorded in “Change in fair value of financial instruments and other” line item in the accompanying unaudited condensed consolidated statements of operations.

If a decline in fair value below the carrying value is determined to be not recoverable, an impairment charge is recorded in “Change in fair value of financial instruments and other” line item in the accompanying unaudited condensed consolidated statements of operations.

(l) Inventories

30 unchanged sentences

This ASU requires additional expense disclosures by public entities in the notes to the financial statements.

The ASU outlines the specific costs that are required to be disclosed which include such costs as:

The ASU outlines the specific costs that are required

to be disclosed which include such costs as:

purchases of inventory, employee compensation, depreciation, intangible asset amortization, selling costs, and depreciation, depletion, and amortization related to oil and gas production.

2 unchanged sentences

In January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures:

Claiming the Effective Date,

which clarified the effective date for entities that do not have an annual reporting period that ends on December 31 st .

Claiming the Effective Date, which clarified the effective date for entities that do not have an annual reporting period that ends on December 31 st .

The guidance is effective for annual periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted.

7 unchanged sentences

(“FRG”) take-private transaction, one of the Company’s subsidiaries (the “Lender”) and an affiliate of Mr.

Kahn (the “Borrower”) entered into an amended and restated promissory note as discussed further in Note 6 - Securities and Other Investments Owned and Securities Sold Not Yet Purchased and Note 9 - Loans Receivable, at Fair Value.

Kahn (the “Borrower”) entered into an amended and restated promissory note as discussed further in Note 9 - Loans Receivable, at Fair Value.

The Company was not involved in the design of the Borrower, has no equity financial interest, and has no rights to make decisions or participate in the management of the Borrower that significantly impact the economics of the Borrower.

Since the Company does not have the power to direct the activities of the Borrower, the Company is not the primary beneficiary and therefore does not consolidate the Borrower.

As of December 31, 2025, the maximum amount of loss exposure to the VIE on a fair value basis was $ 1,835 .

The Company has entered into agreements to provide investment banking and advisory services to numerous investment funds (the “Funds”) that are considered variable interest entities under the accounting guidance.

The Company earns fees from the Funds in the form of placement agent fees and carried interest.

For placement agent fees, the Company receives a cash fee of generally 7 % to 10 % of the amount of raised capital for the Funds, and the fee is recognized at the time the placement services occurred.

The Company receives carried interest as a percentage allocation ( 8 % to 15 %) of the profits of the Funds as compensation for asset management services provided to the Funds and it is recognized under the ownership model of ASC 323, Investments – Equity Method and Joint Ventures, as an equity method investment with changes in allocation recorded currently in the results of operations.

As the fee arrangements under such agreements are arm’s length and contain customary terms and conditions and represent compensation that is considered fair value for the services provided, the fee arrangements are not considered variable interests and accordingly, the Company does not consolidate such VIEs.

Placement agent fees attributable to such arrangements were zero during the three months ended March 31, 2026 and 2025, respectively, and were included in the “Services and fees” line item in the accompanying unaudited condensed consolidated statements of operations.

The promissory note is included in the “Loans receivable, at fair value” line item in the accompanying unaudited condensed consolidated balance sheets and is a variable interest in accordance with the accounting guidance at December 31, 2025, and the maximum amount of loss exposure to the VIE on a fair value basis was $ 1,835 .

In February 2026, the Company collected proceeds in the amount of $ 1,855 from the sale of collateral related to the promissory note and does not expect to collect any further amounts.

As such, there is no balance remaining for the promissory note that is included in Loans receivable, at fair value in the Company’s accompanying unaudited condensed consolidated balance sheets at June 30, 2026 and the promissory note is no longer a variable interest.

On April 14, 2026, the Company invested $ 750 in a Special Purpose Entity (“SPE”) that owns a publicly traded equity security.

The SPE is managed by a third party that serves as the investment manager.

The Company owns approximately 7 % of the SPE in the form of a Class A membership interest in the limited liability company.

The SPE governing documents do not provide any kick-out or participating rights.

Since the Company does not have the power to direct the SPE’s activities, the Company is not the primary beneficiary and therefore does not consolidate the SPE.

However, the Company is presumed to have the ability to exercise significant influence since the investment is more than minor and the limited liability company is required to maintain specific ownership accounts for each member.

The Company has elected to account for its equity investment in the SPE under the fair value option.

The Class A membership interest is included as an equity security at fair value in the “Securities and other investments owned, at fair value” line item in the accompanying unaudited condensed consolidated balance sheet at June 30, 2026 and is a variable interest in accordance with the accounting guidance.

As of June 30, 2026, the maximum amount of loss exposure to the VIE was $ 1,294 .

On May 26, 2026, a strategic asset company assigned a $ 20,000 advance under an existing facility with Enovum NC-1 Venture, LLC (“Enovum”), to the Company’s wholly owned subsidiary B.

Riley Securities, Inc.

(“BRS”) for consideration of $ 19,400 , and Enovum issued a promissory note to BRS on the same economic terms as the original lender, as discussed further in Note 9 - Loans Receivable, at Fair Value.

The Company determined that Enovum is a variable interest entity because its equity at risk is insufficient to finance its activities without additional subordinated financial support.

Since the Company does not have the power to direct the activities of Enovum, the Company is not the primary beneficiary and therefore does not consolidate Enovum.

The promissory note is included in the “Loans receivable, at fair value” line item in the accompanying unaudited condensed consolidated balance sheet at June 30, 2026 and is a variable interest in

accordance with the accounting guidance.

As of June 30, 2026, the maximum amount of loss exposure to the VIE on a fair value basis was $ 20,545 .

The carrying amounts included in the Company’s accompanying unaudited condensed consolidated balance sheets related to variable interests in VIEs that were not consolidated are shown below.

2026 December 31,

Securities and other investments owned, at fair value $ 1,294 $ —

Loans receivable, at fair value 19,794 17,294

13 unchanged sentences

Subsequent to March 31, 2025, certain of Nogin’s creditors filed an involuntary petition for relief under chapter 7 of title 11 of the United States Code in the United States Bankruptcy Court for the District of New York and an order for relief was entered to move the ABC to a liquidation.

A gain of $ 28,411 was recognized during the three months ended March 31, 2025 from deconsolidation of Nogin, which is included in the “Gain on sale and deconsolidation of businesses” line item in the accompanying unaudited condensed consolidated statements of operations.

A gain of $ 28,411 was recognized during the six months ended June 30, 2025 from deconsolidation of Nogin, which is included in the “Gain on sale and deconsolidation of businesses” line item in the accompanying unaudited condensed consolidated statements of operations.

BRC Partners Opportunities Trust (“BRC Trust”)

4 unchanged sentences

Additionally, the BRC Trust does not meet the definition of a business and the initial consolidation of the BRC Trust did not result in a gain or loss upon initial consolidation.

The carrying amounts and classification of the assets, liabilities and noncontrolling interest of the BRC Trust as of March 31, 2026 and December 31, 2025, are as follows:

March 31, 2026 December 31, 2025

The carrying amounts and classification of the assets, liabilities and noncontrolling interest of the BRC Trust as of June 30, 2026 and December 31, 2025, are as follows:

June 30, 2026 December 31, 2025

Cash and cash equivalents $ 183 $ 446

21 unchanged sentences

Upon closing the transaction on April 4, 2025, the sale was completed for net cash consideration of $ 26,037 , representing 36 financial advisors whose managed accounts represent approximately $ 4.0 billion, or 23.6 %, of total assets under management as of the close of the transaction.

A gain of $ 5,372 was recognized on April 4, 2025 in connection with the completion of the sale.

A gain of $ 5,372 was recognized during the three and six months ended June 30, 2025 from this sale, which is included in the “Gain on sale and deconsolidation of businesses” line item in the accompanying unaudited condensed consolidated statements of operations.

Atlantic Coast Recycling

4 unchanged sentences

(“Oaktree”) on February 26, 2025.

A gain of $ 52,430 was recognized during the three months ended March 31, 2025 from this sale, which is included in the “Gain on sale and deconsolidation of businesses” line item in the accompanying unaudited condensed consolidated statements of operations.

Operating results from the sale of the Wealth Management business and Atlantic Coast Recycling businesses contributed to the operating incomes of the Wealth Management segment and Corporate and All Other category, respectively, for the three months ended March 31, 2025.

A gain of $ 52,430 was recognized during the six months ended June 30, 2025 from this sale, which is included in the “Gain on sale and deconsolidation of businesses” line item in the accompanying unaudited condensed consolidated statements of operations.

Discontinued Operations

6 unchanged sentences

The major classes of assets and liabilities included in discontinued operations were as follows:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Prepaid expenses and other assets $ 2,221 $ 2,221

2 unchanged sentences

Total liabilities $ 830 $ 830

Revenues, expenses and income from discontinued operations for the three months ended March 31, 2025 were as follows:

Three Months Ended

March 31, 2025

Revenues, expenses and income from discontinued operations for the three and six months ended June 30, 2025 were as follows:

Three Months Ended Six Months Ended

June 30, 2025 June 30, 2025

Services and fees $ 19,465 $ 40,575

4 unchanged sentences

Interest income 4 7

Gain on disposal of discontinued operations before income taxes 66,795 66,795

Income from discontinued operations before income taxes 69,672 73,172

Provision for benefit from income taxes ( 105 )

Provision for income taxes ( 360 ) ( 465 )

Income from discontinued operations, net of income taxes $ 69,312 $ 72,707

Cash flows from discontinued operations were as follows:

Three Months Ended

March 31, 2025

Six Months Ended

June 30, 2025

Net cash from discontinued operations provided by (used in):

5 unchanged sentences

Supplemental disclosures from cash flows were as follows:

Three Months Ended

March 31, 2025

Six Months Ended

June 30, 2025

Interest paid - Continuing Operations $ 55,011

5 unchanged sentences

NOTE 5 — FAIR VALUE MEASUREMENTS

The following tables present information on the financial assets and liabilities measured and recorded at fair value on a recurring basis as of March 31, 2026 and December 31, 2025.

The following tables present information on the financial assets and liabilities measured and recorded at fair value on a recurring basis as of June 30, 2026 and December 31, 2025.

Financial Assets and Liabilities Measured at Fair Value on a

Recurring Basis as of March 31, 2026 Using

Fair value as of March 31, 2026

Recurring Basis as of June 30, 2026 Using

Fair value as of June 30, 2026

Quoted prices in active markets

13 unchanged sentences

Corporate bonds 593 — 593 —

Other fixed income securities 2,040 1,994 46 —

Total securities sold not yet purchased 9,487 8,593 894 —

Liability-classified warrants 11,080 — — 11,080

Embedded derivatives, included in accrued expenses and other liabilities 797 — — 797

Total liabilities measured at fair value $ 10,284 $ 8,593 $ 894 $ 797

17 unchanged sentences

Corporate bonds 467 — 467 —

Other fixed income securities — — — —

Total securities sold not yet purchased 9,809 9,342 467 —

Contingent consideration 6,400 — — 6,400

Liability-classified warrants 6,400 — — 6,400

Total liabilities measured at fair value $ 16,209 $ 9,342 $ 467 $ 6,400

As of March 31, 2026 and December 31, 2025, financial assets measured and reported at fair value on a recurring basis and classified within Level 3 were $ 108,032 and $ 137,608 , respectively, or 5.8 % and 8.1 %, respectively, of the Company’s total assets.

As of June 30, 2026 and December 31, 2025, financial assets measured and reported at fair value on a recurring basis and classified within Level 3 were $ 230,876 and $ 137,608 , respectively, or 11.7 % and 8.1 %, respectively, of the Company’s total assets.

In determining the fair value for these Level 3 financial assets, the Company analyzes various financial, performance and market factors to estimate the value, including where applicable, over-the-counter market trading activity.

The fair value for individual Level 3 financial assets and liabilities have various financial inputs which include multiple of sales, the market price of related securities, annualized volatility, discount rates, recovery rates and expected term inputs that may change at each reporting period and result in an increase or decrease in the valuation of Level 3 financial assets and liabilities.

The following tables summarize the significant unobservable inputs in the fair value measurement of Level 3 financial assets and liabilities by category of investment and valuation technique as of March 31, 2026 and December 31, 2025:

Fair value at March 31,

The fair value for individual Level 3 financial assets and liabilities have various financial inputs which include multiple of sales, multiple of EBITDA and indexes, the market price of related securities, annualized volatility, carried interest %, discount rates, recovery rates and expected term inputs that may change at each reporting period and result in an increase or decrease in the valuation of Level 3 financial assets and liabilities.

Fair value at June 30,

2026 Valuation

1 unchanged sentence

Input Range Weighted

Equity securities $ 27,898 Market approach Multiple of sales 0.7 x - 6.0 x

Equity securities $ 28,087 Market approach Multiple of EBITDA and indexes 1.8 x - 7.3 x

Multiple of sales 0.7 x - 8.5 x

Market price of related security $ 10.32 - $ 12.01

1 unchanged sentence

921 Option pricing model Annualized volatility 50.0 % - 110.0 %

Partnership interests and other investments 52,650 Market approach Discount rate — % - 3.7 %

Market price of related security $ 526.59

Partnership interests and other investments 83,026 Market approach Carried interest sharing 15.0 % - 46.3 %

Loans receivable at fair value 38,802 Discounted cash flow Discount rate 6.8 % - 93.7 %

Recovery rate 35.9 %

Total level 3 assets measured at fair value $ 230,876

Liability-classified warrants $ 11,080 Monte Carlo simulation and Black-Scholes option pricing model Annualized volatility 87.5 % 87.5 %

Embedded derivatives, included in accrued expenses and other liabilities $ 797 Discounted cash flow Discount rate 15.9 % 15.9 %

Monte Carlo simulation Annualized volatility 95.0 % - 100.0 %

Total level 3 liabilities measured at fair value $ 797

15 unchanged sentences

(1) Unobservable inputs were weighted by the relative fair value of the financial instruments.

The changes in Level 3 fair value hierarchy during the three months ended March 31, 2026 and 2025 were as follows:

Equity Securities Partnership Interests And Other Investments Loans Receivable at Fair Value Contingent Consideration Liability-Classified Warrants Embedded Derivatives

Three Months Ended March 31, 2026

Level 3 balance at beginning of year $ 71,223 $ 40,082 $ 26,303 $ — $ 6,400 $ —

The changes in Level 3 fair value hierarchy during the three months ended June 30, 2026 and 2025 were as follows:

Equity Securities Partnership Interests And Other Investments Loans Receivable at Fair Value Contingent Consideration Liability-Classified Warrants (4)

Embedded Derivatives

Three Months Ended June 30, 2026

Level 3 balance at beginning of period $ 30,455 $ 52,650 $ 24,927 $ — $ 11,080 $ —

Fair value adjustments (1)

2 unchanged sentences

Purchases/originations 225,749 — 24,097 — — —

Settlements/repayments ( 155,174 ) — ( 14,700 ) — ( 15,810 ) —

Level 3 balance at end of period $ 109,048 $ 83,026 $ 38,802 $ — $ — $ 797

Change in unrealized gains (losses) (2)

$ 8,552 $ — $ 2,315 $ — $ — $ ( 797 )

Three Months Ended June 30, 2025

Level 3 balance at beginning of period $ 27,530 $ — $ 98,596 $ 4,593 $ 5,160 $ 14,593

Fair value adjustments (3)

197 1,029 799 63 ( 1,000 ) ( 11,468 )

Purchases/originations 24,998 — 624 — — —

Sales — — ( 3,575 ) — — —

Settlements/repayments ( 24,999 ) — ( 47,464 ) ( 48 ) — ( 3,125 )

Transfers in and/or out of Level 3 — — — — — —

Level 3 balance at end of period $ 27,726 $ 1,029 $ 48,980 $ 4,608 $ 4,160 $ —

1 unchanged sentence

$ 197 $ 1,029 $ 799 $ ( 63 ) $ 1,000 $ 11,468

Three Months Ended March 31, 2025

Level 3 balance at beginning of year $ 40,516 $ — $ 90,103 $ 4,538 $ — $ —

Fair value adjustments during the three months ended June 30, 2026 include the following:

$ 8,018 of realized and unrealized gains (losses) on equity securities is comprised of $ 4,946 included in “Trading gains, net” and $ 3,072 included in “Realized and unrealized gains (losses) on investments”, $ 30,376 of fees from investment income that has not yet been distributed from investment funds, $ 4,245 of fair value adjustments on loans included in “Fair value adjustments on loans”, $ 4,730 of realized losses related to liability-classified warrants included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

For the three months ended June 30, 2026 and 2025, the change in unrealized gains (losses) is related to financial instruments held at the end of each respective reporting period.

Fair value adjustments during the three months ended June 30, 2025 include the following:

$ 197 of realized and unrealized gains (losses) on equity securities comprised of $( 92 ) included in “Trading gains, net” and $ 289 included in “Realized and unrealized gains (losses) on investments”, $ 799 of fair value adjustments on loans included in “Fair value adjustments on loans”, $ 1,029 of realized and unrealized gains related to other assets which is comprised of $ 902 recorded to “Trading gains, net” and $ 127 recorded to “Realized and unrealized gains (losses) on investments”, $( 63 ) of realized and unrealized losses related to contingent consideration included in “Selling, general and administrative expenses”, $ 1,000 of unrealized gains related to liability-classified warrants included in “Change in fair value of financial instruments and other”, and $ 11,468 of unrealized gains related to embedded derivatives included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

On May 28, 2026, immediately prior to exercise, the Oaktree Warrants were remeasured to fair value, resulting in a fair value of $ 15,810 .

This fair value represents the final measurement of the warrant liability immediately prior to settlement and does not reflect the subsequent gain recognized upon settlement of the Oaktree Warrants (see Note 22 – Stockholders’ Equity).

The changes in Level 3 fair value hierarchy during the six months ended June 30, 2026 and 2025 were as follows:

Equity Securities Partnership Interests And Other Investments Loans Receivable at Fair Value Contingent Consideration Liability-Classified Warrants Embedded Derivatives

Six Months Ended June 30, 2026

Level 3 balance at beginning of period $ 71,223 $ 40,082 $ 26,303 $ — $ 6,400 $ —

Fair value adjustments (1)

2 unchanged sentences

Purchases/originations 375,751 — 44,197 — — —

Settlements/repayments ( 343,895 ) — ( 43,205 ) — ( 15,810 ) —

Level 3 balance at end of period $ 109,048 $ 83,026 $ 38,802 $ — $ — $ 797

Change in unrealized gains (losses) (2)

$ 6,552 $ — $ 2,170 $ — $ — $ ( 797 )

Six Months Ended June 30, 2025

Level 3 balance at beginning of period $ 40,516 $ — $ 90,103 $ 4,538 $ — $ —

Fair value adjustments (3)

( 3,648 ) 1,029 ( 7,296 ) 166 ( 3,700 ) ( 8,119 )

Purchases/originations 25,867 — 58,632 — 7,860 11,244

Sales ( 10,000 ) — ( 10,415 ) — — —

Settlements/repayments ( 25,009 ) — ( 82,044 ) ( 96 ) — ( 3,125 )

Transfers in and/or out of Level 3 — — — — — —

Level 3 balance at end of period $ 27,726 $ 1,029 $ 48,980 $ 4,608 $ 4,160 $ —

1 unchanged sentence

$ ( 3,648 ) $ 1,029 $ ( 8,834 ) $ ( 166 ) $ 3,700 $ 8,119

Fair value adjustments during the three months ended March 31, 2026 include the following:

$( 2,049 ) of realized and unrealized gains (losses) on equity securities is comprised of $( 925 ) included in “Trading gains (losses), net” and $( 1,124 ) of “Realized and unrealized gains (losses) on investments”, $ 6,545 of fair value adjustments on loans included in “Fair value adjustments on loans”, and $( 4,680 ) of unrealized losses related to liability-classified warrants included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

For the three months ended March 31, 2026 and 2025, the change in unrealized gains (losses) is related to financial instruments held at the end of each respective reporting period.

Fair value adjustments during the three months ended March 31, 2025 include the following:

$( 3,844 ) of realized and unrealized gains (losses) on equity securities comprised of $( 1,082 ) included in “Trading gains (losses), net” and $( 2,762 ) included in “Realized and unrealized gains (losses) on investments”, $( 8,096 ) of fair value adjustments on loans included in “Fair value adjustments on loans”, $( 103 ) of realized and unrealized losses related to contingent consideration included in “Selling, general and administrative expenses”, $ 2,700 of unrealized gains related to liability-classified warrants included in “Change in fair value of financial instruments and other”, and $( 3,349 ) of unrealized losses related to embedded derivatives included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

Partnership and investment fund interests valued at NAV were $ 2,676 and $ 1,833 as of March 31, 2026 and December 31, 2025, respectively.

Beginning in April 2025, the Company entered into purchase agreements with public companies that allow the counterparties to put their convertible preferred stock to the Company from time to time at its discretion (the “Written Puts”) (see Note 26 – Commitments and Contingencies).

Fair value adjustments during the six months ended June 30, 2026 include the following:

$ 5,969 of realized and unrealized gains (losses) on equity securities comprised of $ 4,021 included in “Trading gains, net” and $ 1,948 of “Realized and unrealized gains (losses) on investments”, $ 42,944 of fees from investment income that has not yet been distributed from investment funds, $ 2,170 of fair value adjustments on loans included in “Fair value adjustments on loans”, $ 9,410 of realized losses related to liability-classified warrants included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

For the six months ended June 30, 2026 and 2025, the change in unrealized gains (losses) is related to financial instruments held at the end of each respective reporting period.

Fair value adjustments during the six months ended June 30, 2025 include the following:

$( 3,648 ) of realized and unrealized gains (losses) on equity securities comprised of $( 1,174 ) included in “Trading gains, net” and $( 2,474 ) of “Realized and unrealized gains (losses) on investments”, $( 7,296 ) of fair value adjustments on loans included in “Fair value adjustments on loans”, $ 1,029 of realized and unrealized gains related to other assets which is comprised of $ 902 recorded to “Trading gains (losses), net” and $ 127 recorded to “Realized and unrealized gains (losses) on investments”, $( 166 ) of realized and unrealized losses related to contingent consideration included in “Selling, general and administrative expenses”, $ 3,700 of unrealized gains related to liability-classified warrants included in “Change in fair value of financial instruments and other”, and $ 8,119 of unrealized gains related to embedded derivatives included in “Change in fair value of financial instruments and other” line items in the accompanying unaudited condensed consolidated statements of operations.

Partnership and investment fund interests valued at NAV were $ 2,374 and $ 1,833 as of June 30, 2026 and December 31, 2025, respectively.

Puts”) (see Note 26 – Commitments and Contingencies).

The Written Puts are recognized at fair value on a recurring basis within the “Accrued expenses and other liabilities” line item on the accompanying unaudited condensed consolidated balance sheets, with changes in fair value recognized in earnings.

At inception and as of March 31, 2026, the Company determined that the fair value of the Written Put liability is de minimis due to its discount to market prices being advantageous to the Company, and no liability or changes in earnings were recorded on the accompanying unaudited condensed consolidated balance sheets or accompanying unaudited condensed consolidated statements of operations, respectively.

As of June 30, 2026 and December 31, 2025, the Company determined that the fair value of the Written Put liability was de minimis due to its discount to market prices being advantageous to the Company, and no liability or changes in earnings were recorded on the accompanying unaudited condensed consolidated balance sheets or accompanying unaudited condensed consolidated statements of operations.

The Company holds the Written Puts as investments to advantageously monetize the underlying stock and provide capital raising activities for customers.

The Company’s exposure is driven primarily by movements in the Issuer’s common stock price, the put writer’s credit, and by assumptions regarding the likelihood and timing of exercise.

The Company’s exposure is driven primarily by movements in the Issuer’s common stock price, the put writer’s credit by assumptions regarding the likelihood and timing of exercise and the April 2026 agreement which was amended to allow for the Issuer’s creditor to exercise the Written Put upon the Issuer’s Event of Default under the terms of its credit agreement.

The amendment had a de minimis impact on the fair value of the Written Put.

Assets and Liabilities Not Measured at Fair Value

The carrying amounts reported in the unaudited condensed consolidated financial statements for cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value based on the short-term maturity of these instruments.

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Fair Value Hierarchy Level Carrying Amount Fair Value Carrying Amount Fair Value

Revolving credit facility Level 2 $ 10,708 $ 10,695 $ 6,638 $ 6,638

Revolving credit facilities Level 2 $ 31,316 $ 31,104 $ 6,638 $ 6,638

Term loans, net Level 2 $ 115,770 $ 121,906 $ 119,297 $ 120,931

1 unchanged sentence

New Notes payable Level 3 $ 258,930 $ 202,511 $ 268,016 $ 166,796

The carrying values of the Company’s notes payable, revolving credit facility, and term loans approximate their respective estimated fair values because the effective yield of such instrument is consistent with current market rates of interest for instruments of comparable credit risk.

The fair value of the Company's revolving credit facilities and term loans was estimated using a discounted cash flow approach, whereby contractual cash flows were discounted using current market interest rates and applicable credit spreads.

The Company used a market approach for estimating the fair value of senior notes payable as they are listed and actively traded on the Nasdaq with sufficient frequency and volume to utilize quoted market prices.

The fair value of the Company’s New Notes payable was estimated using a discounted cash flow approach, whereby contractual cash flows were discounted using a credit spread based on significant unobservable inputs, including the Company's estimated cost of borrowing of approximately 15.0 %.

Nonrecurring Fair Value Measurement

1 unchanged sentence

Fair Value Level 2 Level 3

As of March 31, 2026

As of June 30, 2026

Non-marketable equity securities measured using the measurement alternative $ 17,284 $ 17,284 $ —

2 unchanged sentences

NOTE 6 — SECURITIES AND OTHER INVESTMENTS OWNED AND SECURITIES SOLD NOT YET PURCHASED

The Company’s securities and other investments owned and securities sold not yet purchased consisted of the following as of March 31, 2026 and December 31, 2025:

The Company’s securities and other investments owned and securities sold not yet purchased consisted of the following as of June 30, 2026 and December 31, 2025:

2026 December 31,

12 unchanged sentences

Corporate bonds 593 467

Other fixed income securities 2,040 —

Total securities sold not yet purchased, at fair value $ 9,487 $ 9,809

Unrealized gains (losses) on equity securities held at March 31, 2026 include unrealized gains (losses) of $ 95,736 and $( 16,209 ) for the three months ended March 31, 2026 and 2025, respectively, which is included in the “Realized and unrealized gains (losses) on investments” line item on the accompanying unaudited condensed consolidated statements of operations.

The following table presents the related adjustments recorded during the three months ended March 31, 2026 and 2025 for equity securities measured under the measurement alternative and for those securities with observable price changes:

Three Months Ended March 31,

Unrealized gains (losses) on equity securities held at June 30, 2026 include unrealized gains of $ 2,404 and $ 2,855 for the three months ended June 30, 2026 and 2025 respectively, and unrealized gains (losses) of $ 98,394 and $( 13,127 ) for the six months ended June 30, 2026 and 2025, respectively, which is included in the “Realized and unrealized gains (losses) on investments” line item on the accompanying unaudited condensed consolidated statements of operations.

The following table presents the related adjustments recorded during the three and six months ended June 30, 2026 and 2025 for equity securities measured under the measurement alternative and for those securities with observable price changes:

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Upward carrying value changes (1)

$ 1,415 — $ 1,415 1,732

Downward carrying value changes/impairment (2)

$ ( 1,400 ) — $ ( 2,268 ) ( 592 )

_________________________

(1) The cumulative upward carrying value changes between September 6, 2019 and June 30, 2026 were $ 12,533 .

(2) The cumulative downward carrying value changes/impairment between September 6, 2019 and June 30, 2026 were $( 13,553 ).

Certain equity securities investments in public and private companies are accounted for under the fair value option where the Company would otherwise use the equity method of accounting.

The Company accounts for these equity investments at fair value to provide management with a more relevant representation for evaluating risk, performance reporting, market conditions and economic events in earnings on a more timely basis and to provide reporting of the current value of those assets in the accompanying unaudited condensed consolidated balance sheets.

The related summarized financial information included below for purposes of disclosure are presented a quarter in arrears where balance sheet amounts as of December 31, 2025 and September 30, 2025 corresponds to amounts as of March 31, 2026 and December 31, 2025, and income statement amounts for the three months ended December 31, 2025 and 2024 correspond to amounts for the three months ended March 31, 2026 and 2025 of the Company, respectively.

The related summarized financial information included below for purposes of disclosure are presented a quarter in arrears where balance sheet amounts as of March 31, 2026 and September 30, 2025 correspond to amounts as of June 30, 2026 and December 31, 2025, respectively, and income statement amounts for the three and six months ended March 31, 2026 and 2025 correspond to amounts for the three and six months ended June 30, 2026 and 2025 of the Company, respectively.

Babcock and Wilcox Enterprises, Inc, Equity Investment

The Company owned a 19 % and 25 % voting interest in Babcock & Wilcox Enterprises, Inc.

(“B&W”) as of March 31, 2026 and December 31, 2025, respectively, whereby the Company has elected to account for this investment under the fair value option.

(“B&W”) as of June 30, 2026 and December 31, 2025, respectively, whereby the Company has elected to account for this investment under the fair value option.

The following tables contain summarized financial information with respect to B&W:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Current assets $ 491,272 $ 479,733

3 unchanged sentences

Deficit attributable to investee $ ( 172,095 ) $ ( 232,207 )

Three Months Ended December 31,

Three Months Ended March 31, Six Months Ended March 31,

2026 2025 2026 2025

Revenues $ 214,414 $ 181,194 $ 327,831 $ 247,470

1 unchanged sentence

Loss from continuing operations $ ( 79,622 ) $ ( 7,763 ) $ ( 96,313 ) $ ( 79,081 )

Net income (loss) $ 9,230 $ ( 63,021 )

Net income (loss) attributable to investees $ 9,230 $ ( 63,065 )

As of March 31, 2026 and December 31, 2025, the fair value of the investment in B&W totaled $ 403,189 and $ 174,011 , respectively, and is included in the “Securities and other investments owned, at fair value” line item in the accompanying unaudited condensed consolidated balance sheets.

Net loss $ ( 76,945 ) $ ( 21,989 ) $ ( 67,715 ) $ ( 85,010 )

Net loss attributable to investees $ ( 76,945 ) $ ( 22,007 ) $ ( 67,715 ) $ ( 85,072 )

As of June 30, 2026 and December 31, 2025, the fair value of the investment in B&W totaled $ 386,996 and $ 174,011 , respectively, and is included in the “Securities and other investments owned, at fair value” line item in the accompanying unaudited condensed consolidated balance sheets.

Other Equity Investments

As of March 31, 2026, the Company had other equity investments where the Company is considered to have the ability to exercise influence since the Company has representation on the board of directors or the Company is presumed to have the ability to exercise significant influence since the investment is more than minor, and the limited liability company is required to maintain specific ownership accounts for each member.

As of June 30, 2026, the Company had other equity investments where the Company is considered to have the ability to exercise influence since the Company has representation on the board of directors or the Company is presumed to have the ability to exercise significant influence since the investment is more than minor, and the limited liability company is required to maintain specific ownership accounts for each member.

The Company has elected to account for these equity investments under the fair value option.

These equity investments are comprised of equity investments in three private companies as of March 31, 2026 and December 31, 2025, respectively.

These equity investments are comprised of equity investments in four private companies as of June 30, 2026 and December 31, 2025, respectively.

The following table contains summarized financial information for these companies:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Current assets $ 25,801 $ 23,491

3 unchanged sentences

Equity attributable to investee $ 77,843 $ 74,975

For the Three Months Ended December 31,

For the Three Months Ended March 31, For the Six Months Ended March 31,

2026 2025 2026 2025

Revenues $ 20,039 $ 18,500 $ 35,576 $ 30,223

Cost of revenues $ 2,847 $ 2,003 $ 6,003 $ 4,797

Net income (loss) attributable to investees $ 2,307 $ ( 2,314 )

As of March 31, 2026 and December 31, 2025, the fair value of these investments totaled $ 20,117 and $ 19,835 , respectively, and is included in the “Securities and other investments owned, at fair value” line item in the accompanying unaudited condensed consolidated balance sheets.

Net income attributable to investees $ 1,391 $ 6,323 $ 3,698 $ 4,009

As of June 30, 2026 and December 31, 2025, the fair value of these investments totaled $ 19,903 and $ 19,835 , respectively, and is included in the “Securities and other investments owned, at fair value” line item in the accompanying unaudited condensed consolidated balance sheets.

NOTE 7 — SECURITIES LENDING

The following table presents the contractual gross and net securities borrowing and lending balances and the related offsetting amount as of March 31, 2026 and December 31, 2025:

The following table presents the contractual gross and net securities borrowing and lending balances and the related offsetting amount as of June 30, 2026 and December 31, 2025:

Gross amounts recognized Gross amounts offset in the consolidated balance

Net amounts included in the consolidated balance sheets Amounts not offset in the consolidated balance sheets but eligible for offsetting upon counterparty default (2)

As of March 31, 2026

As of June 30, 2026

Securities borrowed $ 206,717 $ — $ 206,717 $ 206,717 $ —

6 unchanged sentences

(2) Represents the fair value of collateral held/posted which is comprised of financial instruments.

The following table presents the contract value of securities lending transactions accounted for as secured borrowings by the type of collateral provided to counterparties as of March 31, 2026 and December 31, 2025:

Remaining contractual maturity -

Overnight and continuous

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Securities lending transactions:

7 unchanged sentences

Interest expense from securities lending activities is included in operating expenses related to operations in the Capital Markets segment.

Interest expense from securities lending activities is incurred from equity and fixed income securities that are loaned to the Company and totaled $ 717 and $ 719 during the three months ended March 31, 2026 and 2025, respectively.

Such expense is incurred from equity and fixed income securities that are loaned to the Company and totaled $ 906 and $ 1,968 during the three months ended June 30, 2026 and 2025, respectively, and $ 1,623 and $ 2,687 during the six months ended June 30, 2026 and 2025, respectively.

NOTE 8 — ACCOUNTS RECEIVABLE

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Balance, beginning of period $ 6,450 $ 5,343 $ 6,108 $ 6,100

6 unchanged sentences

At Fair Value Outstanding Principal Balance, Net of Discounts Outstanding Principal Balance in Excess of Fair Value

Maturity March 31, December 31, March 31, December 31, March 31, December 31,

Maturity June 30, December 31, June 30, December 31, June 30, December 31,

Dates 2026 2025 2026 2025 2026 2025

Related Party Loans Receivable:

Vintage Capital Management, LLC December 2027 $ — $ 1,835 $ — $ 224,968 $ — $ 223,133

Vintage Capital Management, LLC December 2027 n/a $ 1,835 n/a $ 224,968 n/a $ 223,133

Conn’s, Inc .

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XBP Americas, LLC September 2026 15,041 21,415 15,164 21,731 123 316

Norlin EV Limited December 2025 — 10 1,202 1,233 1,202 1,223

Norlin EV Limited December 2025 n/a 10 n/a 1,233 n/a 1,223

Enovum NC-1 Venture, LLC, a subsidiary of a public AI Infrastructure company August 2026 19,794 — 20,000 — 206 —

Other loans receivable Various 2,932 2,043 8,844 7,845 5,912 5,802

1 unchanged sentence

The Company has elected to measure loans at fair value to provide management with a more relevant representation for evaluating risk, performance reporting, market conditions and economic events in earnings on a more timely basis and to provide reporting of the current value of those assets in the accompanying unaudited condensed consolidated balance sheets.

During the three months ended March 31, 2026 and 2025 the Company recorded realized and unrealized losses of

$ 6,545 and $( 8,096 ), respectively, on loans receivable, at fair value, which are reflected in the “Fair value adjustments on loans” line item in the accompanying unaudited condensed consolidated statements of operations.

Loans receivable at fair value on non-accrual and 90 days or greater past due was zero and $ 1,835 , which represented approximately zero and 7.0 % of total loans receivable at fair value as of March 31, 2026 and December 31, 2025, respectively.

The principal balances of loans receivable on non-accrual and 90 days or greater past due was $ 22,188 and $ 320,285 as of March 31, 2026 and December 31, 2025, respectively.

During the three months ended June 30, 2026 and 2025 the Company recorded realized and unrealized gains of $ 4,245 and $ 800 , respectively, and net realized and unrealized gains and (losses) of $ 10,790 and $( 7,296 ) during the six months ended June 30, 2026 and 2025, respectively, on loans receivable at fair value.

Net realized and unrealized gains and losses on loans receivable are reflected in the “Fair value adjustments on loans” line item in the accompanying unaudited condensed consolidated statements of operations.

The principal balances of loans receivable on non-accrual and 90 days or greater past due was $ 21,276 and $ 320,285 as of June 30, 2026 and December 31, 2025, respectively.

Interest income for loans receivable on non-accrual and/or 90 days or greater past due is recognized separately from the “Fair value adjustments on loans” line item in the accompanying unaudited condensed consolidated statements of operations.

The amount of losses included in earnings attributable to changes in instrument-specific credit risk was $( 147 ) and $( 8,096 ) during the three months ended March 31, 2026 and 2025, respectively.

The amount of gains (losses) included in earnings attributable to changes in instrument-specific credit risk was $ 2,155 and $ 800 during the three months ended June 30, 2026 and 2025, respectively, and $ 2,008 and $( 7,296 ) for the six months ended June 30, 2026 and 2025, respectively.

The gains or losses attributable to changes in instrument-specific risk were determined by management based on an estimate of the fair value change during the period specific to each loan receivable.

The Company may periodically provide limited guarantees to third parties for loans that are made to investment banking and lending clients.

As of March 31, 2026, the Company has outstanding limited guarantee arrangements with respect to B&W as further described in Note 26(b) - Babcock & Wilcox Commitments and Guarantees.

As of June 30, 2026, the Company has outstanding limited guarantee arrangements with respect to B&W as further described in Note 26(b) - Babcock & Wilcox Commitments and Guarantees.

In accordance with the credit loss standard, the Company evaluates the need to record an allowance for credit losses for these loan guarantees since they have off-balance sheet credit exposures.

As of March 31, 2026, the Company has not recorded any provision for credit losses on the B&W guarantees since the Company believes that there is sufficient collateral to protect the Company from any credit loss exposure.

On June 18, 2025, an amendment was made to the Axos Guaranty whereby the Company’s obligations as guarantor were suspended until January 1, 2027.

On June 18, 2025, an amendment was made to the Axos Guaranty, as defined in Note 26 - Commitments and Contingencies, whereby the Company’s obligations as guarantor were suspended

until January 1, 2027.

On February 25, 2026, the Axos Guaranty was terminated and is of no further force and effect as further discussed in Note 26 - Commitments and Contingencies - (b) Babcock & Wilcox Commitments and Guarantees.

27 unchanged sentences

Kahn pleaded guilty to one count of conspiracy to commit securities fraud.

During the three months ended March 31, 2026, the Company collected $ 1,855 on the loan receivable from the sale of all of the collateral that the company held for the Vintage loan.

Kahn is awaiting sentencing.

In February 2026, the Company collected proceeds of $ 1,855 on the loan receivable from the sale of all of the collateral that the Company held for the Vintage loan.

No additional collections are expected on the loan receivable.

Loan Receivable

On December 18, 2023, WSBC was sold by Freedom VCM to Conn’s, Inc.

On December 18, 2023, W.S.

Badcock Corporation, a Florida corporation was sold by Freedom VCM to Conn’s, Inc.

(“Conn’s”) whereby the Company loaned Conn’s $ 108,000 pursuant to the “Conn’s Term Loan” which bears interest at an aggregate rate per annum equal to the Term Secured Overnight Financing Rate (“SOFR”) Rate (as defined in the Conn’s Term Loan), subject to a 4.80 % floor, plus a margin of 8.00 % and matures on February 20, 2027.

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The commencement of the Chapter 11 Cases constitutes an event of default that accelerates the repayment obligations of the loan receivable issued to Conn’s.

Any efforts to enforce repayment obligations under the Conn’s loan are automatically stayed as a result of the Chapter 11 Cases and the Company’s rights of enforcement in respect of this loan are subject to the applicable provisions of the Bankruptcy Code.

Any efforts to enforce repayment obligations under the Conn’s loan are automatically stayed as a result of the Chapter 11 Cases and the

Company’s rights of enforcement in respect of this loan are subject to the applicable provisions of the Bankruptcy Code.

As a result of the Chapter 11 Cases, the Conn’s loan receivable was placed on non-accrual status.

1 unchanged sentence

At the time of the write-off, Conn’s was no longer considered a related party of the Company.

During the three months ended March 31, 2026, the Company recovered $ 6,670 of proceeds from the collateral for the loan receivable which is included in “Fair value adjustments on loans” line item in the accompanying unaudited condensed consolidated statements of operations.

During the six months ended June 30, 2026, the Company recovered $ 8,600 of proceeds from the collateral for the loan receivable which is included in “Fair value adjustments on loans” line item in the accompanying unaudited condensed consolidated statements of operations.

Torticity, LLC Loan Receivable

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Subsequent to December 31, 2024, there were amendments to the loan.

However, the entire loan remained impaired with no fair value at March 31, 2026, and there has been no interest income on the loan receivable during the three months ended March 31, 2026 and all of 2025.

XBP Americas, LLC (formerly Exela Technologies, Inc.) Loans Receivable

As of March 31, 2026, the Company had a loan receivable and an accounts receivable facility with XBP Americas, LLC (“XBP Americas”), with fair value balances of $ 12,212 and $ 9,613 , respectively.

However, the entire loan remained impaired with no fair value at June 30, 2026, and there has been no interest income on the loan receivable during the six months ended June 30, 2026 and all of 2025.

XBP Americas, LLC (formerly Exela Technologies, Inc.

(“Exela”)) Loans Receivable

As of June 30, 2026, the Company had a loan receivable and an accounts receivable facility with XBP Americas, LLC (“XBP Americas”), with fair value balances of $ 9,430 and $ 5,611 , respectively.

As of December 31, 2025, the Company had a loan receivable, accounts receivable facility, and unsecured note with XBP Americas, with fair value balances of $ 15,459 , $ 1,440 , and $ 4,516 , respectively.

2 unchanged sentences

The obligations under the Exela Loan are fully and unconditionally guaranteed, on a joint and several basis, by certain subsidiaries of XBP Americas.

The loan is secured by liens on substantially all assets of XBP Americas and certain

guarantors, including accounts receivable, inventory, cash and deposit accounts, equipment, equity interests in subsidiaries, general intangibles and related assets.

The loan is secured by liens on substantially all assets of XBP Americas and certain guarantors, including accounts receivable, inventory, cash and deposit accounts, equipment, equity interests in subsidiaries, general intangibles and related assets.

The Company’s liens are subordinated to the liens securing XBP Americas’ senior debt facilities.

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In addition, commencing February 6, 2026, the borrower is required to make monthly principal payments of $ 1,000 on the fifth Business Day of each month until the loan is repaid in full.

During the three months ended March 31, 2026, the borrower made $ 3,250 of such mandatory principal repayments.

As of March 31, 2026 and December 31, 2025, the outstanding principal balance of the Exela Loan was $ 12,525 and $ 15,775 , respectively.

During the three and six months ended June 30, 2026, the borrower made $ 3,000 and $ 6,250 of such mandatory principal repayments.

As of June 30, 2026 and December 31, 2025, the outstanding principal balance of the Exela Loan was $ 9,525 and $ 15,775 , respectively.

Exela AR Facility

On February 12, 2024, BR Exar, LLC (“BREL”), an affiliate of BRCC, entered into a receivables purchase agreement with Exela BR SPV, a subsidiary under common control with XBP Americas (as subsequently amended, the “Exela AR Facility”), pursuant to which BREL purchased certain existing receivables and future receivables until the achievement of a specified collection milestone.

specified collection milestone.

As of December 31, 2025, the Exela AR Facility had an outstanding balance of $ 1,440 , which was repaid in full on January 12, 2026.

3 unchanged sentences

The borrower repaid $ 5,000 to fully extinguish the unsecured promissory note on the maturity date.

On January 21, 2026, BREL entered into an amended and restated receivables purchase agreement with certain subsidiaries of XBP Americas (including subsequent amendments, the “Amended Exela AR Facility”), pursuant to which BREL agreed to purchase up to $ 20,000 of receivables.

On May 14, 2026, BREL entered into an amendment which increased the aggregate receivables to be purchased by $ 4,625 , for a total amount of up to $ 24,625 of receivables.

In connection with the Amended Exela AR Facility, the Company provided total consideration of $ 22,623 .

During the three months ended March 31, 2026, the Company collected $ 10,290 under the Amended Exela AR Facility and as of March 31, 2026, $ 9,710 remained outstanding under the Amended Exela AR Facility.

During the three and six months ended June 30, 2026, the Company collected $ 8,696 and $ 18,986 under the Amended Exela AR Facility, respectively, and as of June 30, 2026, $ 5,639 remained outstanding under the Amended Exela AR Facility.

Enovum Loan Receivable

On May 26, 2026, the Company purchased from a strategic asset company $ 20,000 of a Delayed Draw Term Loan Facility and Security Agreement to Enovum, a subsidiary of a public AI infrastructure company.

Enovum received consideration of $ 19,400 and the Company received a Term Loan Note in the amount of $ 20,000 , which included all of the existing rights and obligations of the original lender (the “Enovum Loan”).

The Company funded the Enovum Loan on May 27, 2026.

This Loan bears interest at a rate of 9.50 % per annum, which the borrower may elect to pay in cash or in kind, and steps down to 8.00 % per annum upon the occurrence of a defined rate step down event with a maturity date of August 24, 2026, subject to a 30-day extension only upon the written agreement of the borrower, the Company, and the guarantor.

In addition to principal and interest, the borrower is obligated to pay a minimum multiple on invested capital amount (the “MOIC”) at maturity, such that the aggregate payments to the Company on the advance are no less than 1.1 multiplied by the stated principal amount of the advance (excluding any original issue discount), or $ 22,000 .

The MOIC is not reduced by any prepayment of the loan.

The obligations under the Enovum Loan are guaranteed by another subsidiary of the public AI infrastructure company (the “Guarantor”) and secured by a first priority lien and security interest in all of the equity interests of an affiliate of the AI infrastructure company.

The guaranty and the collateral are released upon the occurrence of a collateral step down event, defined as the date upon which an affiliate of Enovum obtains term loan B or other permanent financing in respect of the development of Enovum’s data center located in Madison, North Carolina.

As of June 30, 2026, the Enovum Loan had a fair value of $ 19,794 and an unpaid principal balance in excess of fair value of $ 206 .

The economic effects of the MOIC and the original issue discount are captured through the periodic remeasurement of the loan to fair value, with the resulting change reported in “Fair value adjustments on loans” in the accompanying unaudited condensed consolidated statements of operations.

NOTE 10 — EQUITY METHOD INVESTMENTS

Equity investments accounted for under the equity method of accounting consist of the following:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Percentage Ownership Investment Balance Percentage Ownership Investment Balance

2 unchanged sentences

Riley Retail Opportunity Fund 22.6 % 6,972 22.6 % 7,084

22.6 % 7,021 22.6 % 7,084

Total equity method investments $ 84,817 $ 90,433

The Company’s share of

earnings or losses from equity method investees is included in the “Income (loss) from equity investments” line item in the accompanying unaudited condensed consolidated statements of operations.

The summarized financial information with respect to the equity method investments noted below for purposes of disclosure are presented a quarter in arrears whereas balance sheet and income statement amounts as of and for the quarter ended December 31, 2025 correspond to amounts as of and for the quarter ended March 31, 2026.

The Company’s share of earnings or losses from equity method investees is included in the “(Loss) income from equity investments” line item in the accompanying unaudited condensed consolidated statements of operations.

Great American Holdings, LLC (“GA Holdings”)

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Each partner’s allocation of income or loss in the period is equal to the change in the amount of net equity they are legally able to claim based on a hypothetical liquidation of the entity at the end of a reporting period compared to the beginning of that period, adjusted for any capital transactions.

Based on the terms of the limited liability agreement, we recorded equity in the net income (loss) attributable to GA Holdings using the HLBV method of $ 323 and $( 449 ) for the three months ended March 31, 2026 and 2025, respectively.

Based on the terms of the limited liability agreement, we recorded equity in the net (loss) income attributable to GA Holdings using the HLBV method of $( 5,828 ) and $ 3,190 for the three months ended June 30, 2026 and 2025, respectively, and $( 5,505 ) and $ 3,639 for the six months ended June 30, 2026 and 2025, respectively.

The following tables contain summarized financial information with respect to GA Holdings:

December 31, 2025 December 31, 2024

March 31, 2026 September 30, 2025

Current assets $ 42,101 $ 58,177

4 unchanged sentences

Equity attributable to investee $ 31,028 $ 10,776

Three Months Ended Period from November 15, 2024 to December 31, 2024

December 31, 2025

For the Three Months Ended March 31, For the Six Months Ended March 31, 2026 Period from November 15, 2024 to March 31, 2025

Revenue $ 37,747 $ 37,062 $ 92,588 $ 58,736

1 unchanged sentence

Net income attributable to investee $ 2,599 $ 4,018 $ 6,039 $ 7,508

GA Joann Retail Partnership, LLC

GA Joann Retail Partnership, LLC (“Joann Retail”)

On February 27, 2025, the Company contributed capital and certain financial support in the form of cash and subordinated debt in exchange for a 47.4 % minority ownership interest in Joann Retail.

1 unchanged sentence

Joann Retail has two classes of equity interest which include voting Class A and nonvoting Class B interests.

In accordance with the accounting for an equity method on a lag basis, the Company did not recognize any equity method earnings or losses for its investment in Joann Retail for the three months ended March 31, 2025 as the Company’s earnings or losses for the period are reflected in the cost of the investment and the initial measurement on February 27, 2025.

As of March 31, 2026, the Company’s investment in Joann Retail was zero as the Company had fully recovered its initial investment of $ 6,163 in Joann Retail during the second quarter of 2025.

As of June 30, 2026, the Company’s investment in Joann Retail was zero as the Company had fully recovered its initial investment of $ 6,163 in Joann Retail during the second quarter of 2025.

Prior to the recovery of the Company’s initial investment, the investment in Joann Retail was adjusted for the Company’s proportionate share of equity method income or losses and of cash distributions received.

The Company received $ 930 in excess of the Company’s investment balance during the three months ended March 31, 2026, and the distributions received in excess of the investment balance are recognized as other income and included in the “Income (loss) from equity investments” line item in the accompanying unaudited condensed consolidated statements of operations.

The Company received $ 1,210 and $ 30,420 in excess of the Company’s investment balance during the six months ended June 30, 2026 and 2025, and the distributions received in excess of the investment balance are recognized as other income and included in the “(Loss) income from equity investments” line item in the accompanying unaudited condensed consolidated statements of operations.

The following tables contain summarized financial information with respect to Joann Retail:

December 31, 2025

March 31, 2026 September 30, 2025

Current assets $ 17,754 $ 27,415

Current liabilities $ 17,754 $ 27,415

Three Months Ended

December 31, 2025

Three Months Ended Period from February 27, 2025 to March 31, 2025 Six Months Ended Period from February 27, 2025 to March 31, 2025

March 31, 2026 March 31, 2026

Revenue $ 2,671 $ — $ 9,254 $ —

Cost of revenue and expenses 710 3,615 2,431 3,615

Net income attributable to investee $ 4,862

Net income (loss) attributed to investee $ 1,961 $ ( 3,615 ) $ 6,823 $ ( 3,615 )

Riley Retail Opportunity Fund (“SW-B.

1 unchanged sentence

Retail is 22.6 %.

During the three months ended March 31, 2026, the Company recorded equity method income (loss) of $ 74 and $( 103 ) for the three months ended March 31, 2026 and March 31, 2025, respectively.

During the three months ended June 30, 2026

and 2025, the Company recorded equity method income of $ 87 and $ 86 respectively, and for the six months ended June 30, 2026 and 2025, the Company recorded equity method income (loss) of $ 161 and $( 17 ) respectively .

NOTE 11 — PREPAID EXPENSES AND OTHER ASSETS

9 unchanged sentences

Prepaid expenses and other assets $ 110,862 $ 128,650

Unbilled receivables represent the amount of mobile handsets in the Marconi Wireless and Lingo segments.

Unbilled receivables represent amounts not yet billed to customers, consisting of mobile handsets and services provided but not yet billed in the Marconi Wireless segment, and hardware, installation, and usage services for customers in the Lingo segment.

Other receivables primarily consist of interest receivables on loans and advances to financial advisors, net.

1 unchanged sentence

NOTE 12 — GOODWILL AND OTHER INTANGIBLE ASSETS

The carrying amount of goodwill at March 31, 2026 and December 31, 2025 was $ 392,687 .

The carrying amount of goodwill at June 30, 2026 and December 31, 2025 was $ 392,687 .

Goodwill is comprised of $ 158,834 for the Capital Markets Segment, $ 37,334 for the Wealth Management Segment, $ 71,551 for the Lingo Segment, $ 106,461 for the magicJack Segment, $ 128 for the Marconi Wireless Segment, $ 15,727 for the UOL Segment, and $ 2,652 for the Corporate and All Other category.

1 unchanged sentence

Intangible assets consisted of the following:

As of March 31, 2026

As of June 30, 2026

As of December 31, 2025

4 unchanged sentences

Domain names 7 170 ( 170 ) — 170 ( 170 ) —

Advertising relationships 8 755 ( 264 ) 491 755 ( 247 ) 508

Franchise rights and advertising relationships 8 to 10

755 ( 280 ) 475 755 ( 247 ) 508

Internally developed software and other intangibles 0.5 to 10

7 unchanged sentences

Intangible assets related to tradenames is net of accumulated impairment losses of $ 26,000 , which were recorded in the Consumer Products segment.

Amortization expense was $ 6,252 and $ 7,642 during the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, estimated future amortization expense was $ 18,305 , $ 23,272 , $ 20,096 , $ 15,470 , and $ 11,167 for the years ended December 31, 2026 (remaining nine months), 2027, 2028, 2029 and 2030, respectively.

Amortization expense was $ 6,172 and $ 6,811 during the three months ended June 30, 2026 and 2025, respectively and $ 12,424 and $ 14,453 during the six months ended June 30, 2026 and 2025, respectively.

As of June 30, 2026, estimated future amortization expense was $ 12,134 , $ 23,272 , $ 20,096 , $ 15,470 , and $ 11,167 for the years ended December 31, 2026 (remaining six months), 2027, 2028, 2029 and 2030, respectively.

The estimated future amortization expense after December 31, 2030 was $ 9,128 .

The Company performs impairment tests for goodwill and intangible assets with an indefinite life as of December 31 of each year and between annual impairment tests if an event occurs or circumstances change that would more likely than not reduce the fair values of the Company’s reporting units or intangible assets below their carrying values.

As a result of the current financial performance of the Company’s Targus subsidiary which comprises the reporting unit of all operations within the Consumer Products segment as well as current market conditions in the personal computer market for computers and accessories, the Company updated its long-term forecasts for the reporting unit.

The Company performed an interim quantitative assessment of intangible assets with an indefinite life as of June 30, 2026.

Prior to the impairment charge, the carrying value of the Targus tradename was $ 13,000 .

Based on the results of the analysis, the Company recorded a non-cash impairment charge related to the Targus tradename of $ 4,000 , which was recorded in impairment of tradename in the accompanying condensed consolidated statements of operations during the three and six months ended June 30, 2026.

The Targus tradename was measured at fair value on a nonrecurring basis as of June 30, 2026 using the relief-from-royalty method.

The estimated fair value of the Targus tradename was $ 9,000 as of June 30, 2026, which is a reduction from the carrying value of $ 13,000 at December 31, 2025, resulting in the $ 4,000 impairment charge discussed above.

The fair value measurement is classified as Level 3 within the fair value hierarchy as the significant inputs are unobservable and reflect management’s estimates and assumptions.

In order to estimate the fair value of the Targus tradename, the key inputs used in the valuation included projected revenues, a royalty rate of 1.0 %, a long-term growth rate of 3.0 %, and a discount rate of 22.0 %.

NOTE 13 — ACCRUED EXPENSES AND OTHER LIABILITIES

11 unchanged sentences

Other liabilities primarily consist of interest payables, accrued legal fees and finance lease liabilities.

NOTE 14 — TERM LOANS AND REVOLVING CREDIT FACILITY

NOTE 14 — TERM LOANS AND REVOLVING CREDIT FACILITIES

Term loans and revolving credit facilities are comprised of the following:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Interest Rate

9 unchanged sentences

$ 115,770 $ 119,297

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Weighted Average

2 unchanged sentences

Principal Interest Rate

Revolver Loan:

Revolver Loans:

Targus Revolver Loan

6.76 % $ 15,316 7.20 % $ 6,638

BRPAC Revolver Loan 6.57 % 16,000 — % —

Total Revolver Loans $ 31,316 $ 6,638

Oaktree Credit Agreement

1 unchanged sentence

with Oaktree Fund Administration, LLC, acting as the administrative agent and collateral agent.

The new credit agreement provided for (i) a three-year $ 125,000 secured term loan credit facility (the “Oaktree Term Loan”) and (ii) a four-month $ 35,000 secured delayed draw term loan credit facility (the “Delayed Draw Facility” and, together with the Oaktree Term Loan, the “Credit Facility”).

The Oaktree Term Loan matures on the earliest of (i) February 26, 2028, and (ii) a springing maturity date 91 days prior to the maturity of any series of bonds, notes or bank indebtedness of the Company or the BRFH Borrower outstanding on such date with an aggregate amount exceeding $ 10,000 (the “Initial Term Loan Maturity Date”).

The proceeds from the Oaktree Term Loan were primarily used (a) to repay the existing indebtedness under the Nomura Credit agreement (b) for working capital and general corporate purposes and (c) to pay transaction fees and expenses.

The proceeds from the Oaktree Term Loan were primarily used (a) to

repay the existing indebtedness under the Nomura Credit agreement (b) for working capital and general corporate purposes and (c) to pay transaction fees and expenses.

The proceeds of the Delayed Draw Facility were used (a) to fund obligations relating to the liquidation of substantially all of the assets of JOANN, Inc.

and its subsidiaries and (b) for working capital and general corporate purposes.

The Credit Facility accrues interest at the adjusted term SOFR rate (as defined in the Credit Facility) with an applicable margin of 8.00 % or interest at the base rate as defined in the Credit Facility plus an applicable margin of 7.00 %.

In addition to paying interest on outstanding borrowings under the Credit Facility, the Company was required to pay (i) a closing fee of 3.00 % of the aggregate principal amount of the loans under the Oaktree Term Loan and 2.00 % of the aggregate principal amount of the loans under the Delayed Draw Facility, and (ii) an exit fee upon the prepayment or repayment of the Credit Facility of 5.00 % of the aggregate principal amount of such loans repaid, provided, that the Oaktree Term Loan exit fee shall not be payable if the share price for the Company’s common stock exceeds a certain threshold.

The Company determined that the Credit Facility is an indexed debt obligation under ASC 470, Debt and is accreting the contingent Oaktree Term Loan exit fee to its expected payment amount.

The Oaktree Credit Facility accrues interest at the adjusted term SOFR rate (as defined in the Oaktree Credit Facility) with an applicable margin of 8.00 % or interest at the base rate as defined in the Oaktree Credit Facility plus an applicable margin of 7.00 %.

In addition to paying interest on outstanding borrowings under the Oaktree Credit Facility, the Company was required to pay (i) a closing fee of 3.00 % of the aggregate principal amount of the loans under the Oaktree Term Loan and 2.00 % of the aggregate principal amount of the loans under the Delayed Draw Facility, and (ii) an exit fee upon the prepayment or repayment of the Oaktree Credit Facility of 5.00 % of the aggregate principal amount of such loans repaid, provided, that the Oaktree Term Loan exit fee shall not be payable if the share price for the Company’s common stock exceeds a certain threshold.

The Company determined that the Oaktree Credit Facility is an indexed debt obligation under ASC 470, Debt and is accreting the contingent Oaktree Term Loan exit fee to its expected payment amount.

The Oaktree Term Loan also contains an additional prepayment premium, as defined in the Oaktree Term Loan, of a minimum of 5.00 %.

At March 31, 2026, under the Oaktree Credit Agreement, certain assets with a total carrying value of $ 334,100 collateralize the $ 62,500 outstanding balance of the Oaktree Term Loan, and these assets primarily consist of the common and preferred equity interest in GA Holdings and certain other designated loans receivable and equity investments held by the BRFH Borrower.

At June 30, 2026, under the Oaktree Credit Agreement, certain assets with a total carrying value of $ 304,400 collateralize the $ 62,500 outstanding balance of the Oaktree Term Loan, and these assets primarily consist of the common and preferred equity interest in GA Holdings and certain other designated loans receivable and equity investments held by the BRFH Borrower.

The collateral for the Oaktree Credit Agreement also includes the equity interests in the BRFH Borrower’s subsidiaries, and the Oaktree Credit Agreement covenants, among other things, limit the Company’s, the BRFH Borrower’s and the BRFH Borrower’s subsidiaries’ ability to incur additional indebtedness or liens, to dispose of assets, to make certain fundamental changes, to enter into restrictive agreements, to make certain investments, loans, advances, guarantees and acquisitions, to prepay certain indebtedness, and to pay dividends or to make other distributions or redemptions/repurchases in respect of their respective equity interests.

The Company is in compliance with all financial covenants in the Oaktree Credit Agreement as of March 31, 2026.

Subject to certain eligibility requirements, certain assets of the BRFH Borrower are placed into a borrowing base (the “Borrowing Base”), which serves to limit the borrowings under the Credit Facility.

The Company is in compliance with all financial covenants in the Oaktree Credit Agreement as of June 30, 2026.

The sale of an asset in the Borrowing Base requires the BRFH Borrower to make a prepayment in an amount equal to the proceeds of such disposition multiplied by the percentage “credit” that is assigned to such asset in the Borrowing Base.

The BRFH Borrower may be obligated to prepay the loans or post cash in a controlled account in the event the Borrowing Base falls below a certain level as defined in the Credit Facility.

The Company recorded a derivative liability of $ 11,244 related to a mandatory repayment feature in the Credit Facility at the inception of the Credit Facility (see Note 5 - Fair Value Measurements).

The BRFH Borrower may be obligated to prepay the loans or post cash in a controlled account in the event the Borrowing Base falls below a certain level as defined in the Oaktree Credit Facility.

The Company recorded a derivative liability of $ 11,244 related to a mandatory repayment feature in the Oaktree Credit Facility at the inception of the Oaktree Credit Facility (see Note 5 - Fair Value Measurements).

The Company sold certain assets in the Borrowing Base that required the Company to repay $ 62,500 of principal on the Oaktree Term Loan and $ 35,000 on the Delayed Draw Facility.

These principal repayments reduced the outstanding balance on the Oaktree Term Loan from $ 125,000 to $ 62,500 and paid the Delayed Draw Facility off in full.

In accordance with paydowns on the Delayed Draw Facility during the three months ended March 31, 2025, the Company recorded a loss on debt extinguishment of $ 5,372 , which was included in the “Loss on extinguishment of debt” line item in the unaudited condensed consolidated statements of operations.

Interest expense on the Credit Facility during the three months ended March 31, 2026 and 2025 was $ 3,121 and $ 3,181 , respectively.

The Company issued warrants to certain affiliates of Oaktree Capital Management, L.P.

in connection with the Oaktree Term Loan to purchase approximately 1,832,290 shares (or 6 % on a fully diluted basis) of the Company’s common stock at an exercise price of $ 5.14 per share.

The warrants contain certain anti-dilution provisions pursuant to which, under certain circumstances, the warrant holders would be entitled to exercise the warrants for up to 19.9 % of the then-outstanding shares of the Company’s common stock.

The Company determined the warrants met the criteria for liability classification under ASC 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity and recorded an initial warrant liability of $ 7,860 .

In accordance with paydowns on the Oaktree Credit Facility, the Company recorded a loss on debt extinguishment of $ 10,266 and $ 15,639 during the three and six months ended June 30, 2025, respectively, which were included in the “(Loss) gain on extinguishment of debt” line item in the unaudited condensed consolidated statements of operations.

Interest expense on the Oaktree Credit Facility during the three months ended June 30, 2026 and 2025 was $ 3,320 and $ 4,578 , respectively.

Interest expense on the Oaktree Credit Facility during the six months ended June 30, 2026 and 2025 was $ 6,441 and $ 7,759 , respectively.

The Company issued warrants (“Oaktree Warrants”) to certain affiliates of Oaktree Capital Management, L.P.

(the “Oaktree Holders”) in connection with the Oaktree Term Loan to purchase approximately 1,832,290 shares (or 6 % on a fully diluted basis) of the Company’s common stock at an exercise price of $ 5.14 per share.

The Oaktree Warrants contained certain anti-dilution provisions pursuant to which, under certain circumstances, the warrant holders would be entitled to exercise the warrants for up to 19.9 % of the then-outstanding shares of the Company’s common stock.

The Company determined the Oaktree Warrants met the criteria for liability classification under ASC 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity and recorded an initial warrant liability of $ 7,860 .

On May 28, 2026, the Oaktree Holders sent a cashless exercise notice to the Company in accordance with the terms of the Oaktree Warrants.

On May 29, 2026, the Company issued an aggregate of 915,251 shares of common stock to the Oaktree Holders in exchange for the surrender by the Oaktree Holders of 917,039 shares of the Company’s common stock.

The shares underlying the Oaktree Warrants are registered for resale on Form S-1 (which was subsequently amended by a Post-Effective Amendment) (Reg.

As of May 29, 2026, the Oaktree Warrants have been fully exercised and are no longer outstanding.

The initial measurement of the embedded derivative and warrant liability creates a discount on the carrying amount of the long-term debt, which together with the original issue discount, debt issuance costs, are amortized via the effective interest method under ASC 835-30, Interest – Imputation of Interest .

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Refer to Note 22(a) - Common Stock Warrants.

During the quarter ended June 30, 2026, the Company determined that the occurrence of the springing maturity, a component of the embedded derivative, was probable which could result in the repayment of the Oaktree Debt on October 4, 2027.

As of June 30, 2026, the embedded derivative has a fair value of $ 797 (See Note 5 – Fair Value Measurement).

As a result of the change in probability of the springing maturity, the Company revised the estimated amortization period of the Oaktree Term Loan.

The amortization of the debt discount and third-party costs was accelerated prospectively.

On March 24, 2025, the Company and the BRFH Borrower entered into Amendment No.

1 to the Credit Facility which, among other things, removed certain pledged stock from the collateral and adjusted mandatory prepayment provisions in connection with dispositions of borrowing base assets.

1 to the Oaktree Credit Facility which, among other things, removed certain pledged stock from the collateral and adjusted mandatory prepayment provisions in connection with dispositions of borrowing base assets.

On July 8, 2025, the Company and the BRFH Borrower entered into Amendment No.

2 to the Credit Facility which, among other things, amended the borrowing base to include certain first lien term loans extended to certain subsidiaries of the Company and made certain changes to the negative covenants.

2 to the Oaktree Credit Facility which, among other things, amended the borrowing base to include certain first lien term loans extended to certain subsidiaries of the Company and made certain changes to the negative covenants.

On October 8, 2025, the Company and the BRFH Borrower entered into Amendment No.

3 to the Credit Facility with Oaktree which provided that the springing maturity date of the Oaktree Term Loan shall in no event

occur prior to March 31, 2027, thereby extending the earliest possible maturity date for the Oaktree Term Loan.

3 to the Oaktree Credit Facility with Oaktree which provided that the springing maturity date of the Oaktree Term Loan shall in no event occur prior to March 31, 2027, thereby extending the earliest possible maturity date for the Oaktree Term Loan.

On January 14, 2026, the Company and the BRFH Borrower entered into Amendment No.

4 to the Credit Facility, which added an additional carve-out with respect to limitation on investments and allows the Company to repurchase unsecured notes on or prior to June 30, 2026 in an aggregate outstanding amount not to exceed $ 25,000 .

Targus Credit Agreement

On October 18, 2022, Targus (“Targus Borrower”), among others, entered into a credit agreement (“Targus Credit Agreement”) with PNC Bank, National Association (“PNC”), as agent and security trustee for a five-year $ 28,000 term loan and a five-year $ 85,000 revolver loan (the “Targus Revolver Loan”), which was used to finance part of the acquisition of Targus.

The final maturity date is October 18, 2027.

On November 7, 2024, the Company repaid the outstanding balance of the term loan in full with $ 2,100 of revolver loan advances and $ 7,500 of cash from the Company.

On August 20, 2025, the Company entered into the Targus/FGI Credit Agreement to refinance and repay all outstanding obligations under the Targus Credit Agreement, as more fully described below.

The revolver loan under the old Targus Credit Agreement consisted of base rate loans that bear interest on the outstanding principal amount equal to the base rate plus an applicable margin of 3.00 % and term rate loans that bear interest on the outstanding principal amount equal to the revolver SOFR rate plus an applicable margin of 4.00 %.

The average borrowings under the revolver loan was $ 16,693 during the three months ended March 31, 2025.

Interest expense on the revolver loan during the three months ended March 31, 2025 was $ 412 .

4 to the Oaktree Credit Facility, which added an additional carve-out with respect to limitation on investments and allows the Company to repurchase unsecured notes on or prior to June 30, 2026 in an aggregate outstanding amount not to exceed $ 25,000 .

Targus/FGI Credit Agreement

On August 20, 2025, the Targus Borrower and certain of the Targus Borrowers’ direct and indirect subsidiaries (the “FGI Loan Parties”) entered into a Revolving Credit, Receivables Purchase, Security and Guaranty Agreement (the “Targus/FGI Credit Agreement”) with FGI Worldwide LLC (“FGI”), as agent and for a three-year $ 30,000 revolving loan facility, the proceeds of which were used to refinance and repay all obligations under the Targus Credit Agreement with PNC.

On August 20, 2025, Targus (“Targus Borrower”) and certain of the Targus Borrower’s direct and indirect subsidiaries (the “FGI Loan Parties”) entered into a Revolving Credit, Receivables Purchase, Security and Guaranty Agreement (the “Targus/FGI Credit Agreement”) with FGI Worldwide LLC (“FGI”), as agent and for a three-year $ 30,000 revolving loan facility, the proceeds of which were used to refinance and repay all obligations under the Targus Credit Agreement with PNC Bank, National Association, dated October 18, 2022 (the “Prior Targus Credit Agreement”).

The final maturity date of the Targus/FGI Credit Agreement is August 20, 2028.

The Targus/FGI Credit Agreement is a revolving line of credit facility with a receivables purchase feature under which the purchase of eligible receivables is on a full recourse basis with each borrower retaining the risk of non-payment.

The revolving loans bear interest at the greater of (a) 5.25 % per annum or (b) 3.00 % above the term SOFR for a period of one plus 10 basis points, plus (c) 0.30 % per month collateral management fee.

The average borrowings under the revolving loan facility was $ 8,383 during the three months ended March 31, 2026.

The amount available for borrowings under the Targus/FGI Credit Agreement was $ 14,601 at March 31, 2026.

Interest expense on these loans during the three months ended March 31, 2026 was $ 235 .

The revolving loans bear interest at the greater of (a) 5.25 % per annum or (b) 3.00 % above the term SOFR for a period of one month plus 10 basis points, plus (c) 0.30 % per month collateral management fee.

The average borrowings under the revolving loan facility was $ 11,551 during the six months ended June 30, 2026.

The amount available for borrowings under the Targus/FGI Credit Agreement was $ 17,635 at June 30, 2026.

Interest expense on these loans during the three and six months ended June 30, 2026 was $ 348 and $ 583 , respectively.

Under the Prior Targus Credit Agreement, the average borrowings under the revolver loan was $ 14,424 during the six months ended June 30, 2025.

Interest expense on the revolver loan during the three and six months ended June 30, 2025 was $ 380 and $ 782 , respectively.

The Targus/FGI Credit Agreement includes certain embedded features, such as a receivable purchase arrangement, default interest of 3.00 %, certain cost reimbursements, and optional and mandatory prepayments that could result in an acceleration of the Company’s obligations.

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The Targus/FGI Credit Agreement is secured by (i) a first priority perfected security interest in and a lien upon all of the assets of the FGI Loan Parties, and (ii) a pledge of all of the equity interests of the Targus Borrower and its direct and indirect subsidiaries.

The Targus/FGI Credit Agreement was secured by substantially all Targus assets as collateral defined in the Targus/FGI Credit Agreement, which assets had an aggregate value of approximately $ 146,236 , including $ 37,451 of accounts receivable and $ 42,581 of inventory as of March 31, 2026.

The Targus/FGI Credit Agreement was secured by substantially all Targus assets as collateral defined in the Targus/FGI Credit Agreement, which assets had an aggregate value of approximately $ 149,409 , including $ 35,846 of accounts receivable and $ 44,355 of inventory as of June 30, 2026.

The Targus/FGI Credit Agreement contains certain covenants, including those limiting the FGI Loan Parties’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends.

The Targus/FGI Credit Agreement also contains customary representations and warranties, affirmative covenants, and events of default, including payment defaults, breach of representations and warranties, covenant defaults and cross defaults.

and cross defaults.

If an uncured event of default occurs, FGI would be entitled to take various actions, including the acceleration of amounts outstanding under the Targus/FGI Credit Agreement.

The Company is in compliance with all financial covenants in the Targus/FGI Credit Agreement as of March 31, 2026.

The Company is in compliance with all financial covenants in the Targus/FGI Credit Agreement as of June 30, 2026.

As required upon the closing of the Targus/FGI Credit Agreement, one of the Company’s subsidiaries was required to invest an additional $ 5,000 in Targus in the form of an intercompany subordinated loan.

In addition, on March 13, 2026, the Company’s subsidiary agreed to invest an additional $ 2,000 in accordance with provisions of the Targus/FGI Credit Agreement which increased the balance of the intercompany subordinated loan.

Lingo Credit Agreement

On August 16, 2022, Lingo (“Lingo Borrower”) entered into a credit agreement (the “Lingo Credit Agreement”) by and among the Lingo Borrower, the Company as the secured guarantor, and Banc of California, N.A.

in its capacity as the administrative agent and lender, for a five-year $ 45,000 term loan (the “Lingo Term Loan”) which was used to finance part of the purchase of BullsEye Telecom, Inc.

Upon a series of amendments, the principal balance of the Lingo Term Loan was increased to $ 73,000 .

Prior to repayment as discussed below, principal outstanding was due in quarterly installments.

On January 6, 2025, as discussed below, BRPI Acquisition Co LLC (“BRPAC”), a Delaware limited liability company, entered into an amended and restated credit agreement (the “BRPAC Amended Credit Agreement”) with Banc of California, N.A.

in its capacity as the administrative agent and lender and with other lenders party thereto from time to time.

A portion of the proceeds from the BRPAC Amended Credit Agreement was used to pay all outstanding principal amounts and accrued interest under the Lingo Term Loan, and the Lingo Credit Agreement was effectively terminated upon repayment on January 6, 2025.

The term loan bore interest on the outstanding principal amount equal to the term SOFR rate plus a margin of 3.00 % to 3.75 % per annum, depending on the consolidated total funded debt ratio as defined in the Lingo Credit Agreement, plus applicable spread adjustment.

Interest expense on the term loan during the three months ended March 31, 2025 was $ 62 .

On June 30, 2026, the FGI Loan Parties entered into a First Amendment to Credit Agreement, Limited Waiver, and Omnibus Joinder Agreement (the “First Amendment”) with FGI.

Among other things, the First Amendment (i) joined Targus Australia Pty.

as an additional guarantor and loan party under the Targus/FGI Credit Agreement, (ii) extended the FCCR Conversion Date (the date on which the financial covenant transitions from a minimum Adjusted Consolidated EBITDA test to a fixed charge coverage ratio test) from December 31, 2026 to October 31, 2027, (iii) restructured the measurement period for the Adjusted Consolidated EBITDA financial covenant, resetting the look-back to a one-month trailing period for the test period ending June 30, 2026 and stepping up to a six-month trailing period by November 30, 2026, and (iv) granted a limited waiver of certain defaults that had occurred and were continuing under the Targus/FGI Credit Agreement as of June 30, 2026.

Nomura Credit Agreement

The Company and its wholly owned subsidiaries, BRFH, and BR Advisory & Investments, LLC had entered into a credit agreement dated June 23, 2021 (as amended, the “Prior Credit Agreement”) with Nomura Corporate Funding Americas, LLC, as administrative agent, and Wells Fargo Bank, N.A., as collateral agent, for a four-year $ 300,000 secured term loan credit facility (the “Prior Term Loan Facility”) and a four-year $ 80,000 secured revolving loan credit facility (the “Prior Revolving Credit Facility”) with a maturity date of June 23, 2025.

On August 21, 2023, the Company, BRFH (the “BRFH Borrower”), and certain direct and indirect subsidiaries of the BRFH Borrower (the “BRFH Guarantors”), entered into a credit agreement (the “Credit Agreement”) with Nomura Corporate Funding Americas, LLC, as administrative agent, and Computershare Trust Company, N.A., as collateral agent, for a four -year $ 500,000 secured term loan credit facility (the “New Term Loan Facility”) and a four-year $ 100,000 secured revolving loan credit facility (the “New Revolving Credit Facility” and together, the “New Credit Facilities”).

The purpose of the Credit Agreement was to (i) fund the Freedom VCM equity investment, (ii) prepay in full the Prior Term Loan Facility and Prior Revolving Credit Facility with an aggregate outstanding balance of $ 347,877 , which included $ 342,000 in principal and $ 5,877 in interest and fees, (iii) fund a dividend reserve in an amount not less than $ 65,000 , (iv) pay related fees and expenses, and (v) for general corporate purposes.

On August 21, 2023, the Company, the BRFH Borrower, and certain direct and indirect subsidiaries of the BRFH Borrower, entered into a credit agreement (the “Nomura Credit Agreement”) with Nomura Corporate Funding Americas, LLC, as administrative agent (“Nomura”), and Computershare Trust Company, N.A., as collateral agent, for a four-year $ 500,000 secured term loan credit facility and a four-year $ 100,000 secured revolving loan credit facility.

The Nomura Credit Agreement replaced the prior credit agreement with Nomura and Wells Fargo Bank, N.A., as collateral agent, dated June 23, 2021, that had a maturity date of June 23, 2025 (the “Prior Nomura Credit Agreement”).

The purpose of the Nomura Credit Agreement was to (i) fund the Freedom VCM equity investment, (ii) prepay in full the Prior Nomura Credit Agreement with an aggregate outstanding balance of $ 347,877 , which included $ 342,000 in principal and $ 5,877 in interest and fees, (iii) fund a dividend reserve in an amount not less than $ 65,000 , (iv) pay related fees and expenses, and (v) for general corporate purposes.

On September 17, 2024, the Company entered into Amendment No.

4 to the Credit Agreement (the “Fourth Nomura Amendment”), and after payment on principal and the addition of loan fees to principal, the outstanding principal balance on the term loan was reduced from $ 469,750 to $ 388,127 .

4 to the Nomura Credit Agreement (the “Fourth Nomura Amendment”), and after payment on principal and the addition of loan fees to principal, the outstanding principal balance on the term loan was reduced from $ 469,750 to $ 388,127 .

In connection with the Fourth Nomura Amendment, the revolving credit facility in the amount of $ 100,000 , which had no balance outstanding at September 17, 2024, was terminated and the Company was required to reduce the principal amount of the term loan to be no greater than $ 100,000 on or prior to September 30, 2025.

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and base rate loans accrued interest at the base rate plus an applicable margin of 6.00 % cash interest or, at the election of the Company, at the adjusted term SOFR determined for such day plus an applicable margin of 5.00 % cash interest plus 1.50 % PIK Interest.

Interest expense on the term loan during the three months ended March 31, 2025 was $ 2,457 .

As fully discussed in “Oaktree Credit Agreement” above, on February 26, 2025, the Company used proceeds from the Credit Facility to repay the outstanding principal balance under the Prior Credit Agreement.

Upon repayment, the Company recorded a loss on extinguishment of debt in the amount of $ 4,666 , which was included in the “Loss on extinguishment of debt” line item in the unaudited condensed consolidated statements of operations during the three months ended March 31, 2025.

Interest expense on the term loan during the six months ended June 30, 2025 was $ 2,457 .

As fully discussed in “Oaktree Credit Agreement” above, on February 26, 2025, the Company used proceeds from the Oaktree Credit Facility to repay the outstanding principal balance under the Nomura Credit Agreement and the Nomura Credit Agreement was terminated.

Upon repayment, the Company recorded a loss on extinguishment of debt in the amount of $ 4,666 , which was included in the “(Loss) gain on extinguishment of debt” line item in the unaudited condensed consolidated statements of operations during the six months ended June 30, 2025.

BRPAC Credit Agreement

On December 19, 2018, BRPAC, UOL, and YMAX Corporation, Delaware corporations (collectively, the “BRPAC Borrowers”), indirect wholly owned subsidiaries of the Company, in the capacity as borrowers, entered into a credit agreement (the “BRPAC Credit Agreement”) with Banc of California, N.A.

in the capacity as agent (the “Agent”) and lender and with the other lenders party thereto (the “Closing Date Lenders”).

On January 6, 2025, BRPAC, Lingo, UOL and YMAX Corporation (collectively, the “BRPAC Borrowers”), indirect wholly owned subsidiaries of the Company, in the capacity as borrowers, entered into an amended and restated credit agreement (the “BRPAC Credit Agreement”), with the Banc of California, in its capacity as sole lead arranger, sole book manager, administrative agent and lender (the “Agent”) and the lenders party thereto from time to time to amend and

restate the prior BRPAC credit agreement, dated December 19, 2018 (the “Prior BRPAC Credit Agreement”) and replace the prior Lingo credit agreement, dated August 16, 2022 (the “Prior Lingo Credit Agreement”).

Certain of the BRPAC Borrowers’ U.S.

subsidiaries are guarantors of all obligations under the BRPAC Credit Agreement and are parties to the BRPAC Credit Agreement in such capacity (collectively, the “Secured Guarantors”;

subsidiaries are parties to and guarantors of all obligations under the BRPAC Credit Agreement (collectively, the “Secured Guarantors”;

and together with the BRPAC Borrowers, the “Credit Parties”).

In addition, the Company and B.

Riley Principal Investments, LLC, the parent corporation of BRPAC and a subsidiary of the Company, are guarantors of the obligations under the BRPAC Credit Agreement pursuant to standalone guaranty agreements pursuant to which the shares outstanding membership interests of BRPAC are pledged as collateral.

On January 6, 2025 (the “Closing Date”), BRPAC entered into the BRPAC Amended Credit Agreement with certain subsidiaries of the Company, the Banc of California, in the capacity as agent and lender and with other lenders party thereto from time to time.

The Company’s subsidiary Lingo was added as a BRPAC Borrower to the BRPAC Amended Credit Agreement.

Pursuant to the BRPAC Amended Credit Agreement, the lenders made a new five-year $ 80,000 term loan to the BRPAC Borrowers, the proceeds of which were used to repay in full the obligations under the original BRPAC Credit Agreement dated December 19, 2018 and the Lingo Credit Agreement.

Upon repayment of the obligations, the Company recorded a loss on extinguishment of debt in the amount of $ 389 , which was included in the “Loss on extinguishment of debt” line item in the accompanying unaudited condensed consolidated statements of operations during the three months ended March 31, 2025.

The refinancing consolidated the prior Lingo Credit Agreement and the BRPAC Credit Agreement into a single debt facility, the BRPAC Amended Credit Agreement.

For accounting purposes, the modification of terms was considered a troubled debt restructuring.

As the future undiscounted cash payments under the terms of the modified debt exceeded the carrying amount of the old debt on the modification date, the Company accounted for the restructuring on a prospective basis using the revised effective interest rate established under the amended agreement.

The carrying amount of the restructured debt includes variable interest rates from Term SOFR.

In connection with the BRPAC Amended Credit Agreement, the BRPAC Borrowers also made certain distributions to the parent company of the BRPAC Borrowers from existing cash on hand.

The BRPAC Amended Credit Agreement also builds in provisions for incremental term loans up to $ 40,000 allowing certain distributions to the parent company of the BRPAC Borrowers from the proceeds of such incremental term loans.

On April 8, 2026 (the “Third Amendment Effective Date”), the BRPAC Borrowers entered into the Third Amendment to the BRPAC Amended Credit Agreement (the “Third Amendment”) with Banc of California, as administrative agent and lender.

The Third Amendment made the following material modifications:

• On the Third Amendment Effective Date, the lenders made a new term loan to the BRPAC Borrowers in an aggregate original principal amount of $ 60,000 , the proceeds of which were used to repay in full the outstanding principal balance and accrued interest on the previously outstanding term loans under the BRPAC Amended Credit Agreement.

Riley Principal Investments, LLC, the parent company of BRPAC and a subsidiary of the Company, are guarantors of the obligations under the BRPAC Credit Agreement pursuant to standalone guaranty agreements pursuant to which the outstanding membership interests of BRPAC are pledged as collateral.

Pursuant to the BRPAC Credit Agreement, the lenders made a five-year $ 80,000 term loan to the BRPAC Borrowers, the proceeds of which were used to repay in full the obligations under the Prior BRPAC Credit Agreement and the Prior Lingo Credit Agreement.

The BRPAC Credit Agreement also builds in provisions for incremental term loans up to $ 40,000 allowing certain distributions to the parent company of the BRPAC Borrowers from the proceeds of such incremental term loans.

Upon repayment of the Prior Credit Agreement and the Lingo Credit Agreement, the Company recorded a loss on extinguishment of debt in the amount of $ 389 , which was included in the “(Loss) gain on extinguishment of debt” line item in the accompanying unaudited condensed consolidated statements of operations during the six months ended June 30, 2025.

The remaining debt modification was accounted for as a troubled debt restructuring.

On April 8, 2026 (“Amendment Effective Date”), the BRPAC Borrowers entered into the Third Amendment to the BRPAC Credit Agreement (the “Third Amendment”) with the Agent.

In connection with the Third Amendment, the lenders made a new term loan to the BRPAC Borrowers in an aggregate original principal amount of $ 60,000 , the proceeds of which were used to repay in full the outstanding principal balance and accrued interest on the previously outstanding term loans under the BRPAC Credit Agreement.

The Third Amendment established a new revolving credit facility with aggregate commitments of $ 20,000 (the “Revolving Credit Facility”), which was not available under the prior facility.

The Revolving Credit Facility matures on January 6, 2030.

On April 8, 2026, the BRPAC Borrowers drew $ 16,000 on the Revolving Credit Facility, which remained outstanding as of June 30, 2026.

The new term loan is repayable in quarterly installments of $ 2,250 beginning June 30, 2026, with the remaining outstanding balance due at maturity on January 6, 2030.

• In connection with the Third Amendment, the BRPAC Borrowers are permitted to make an aggregate cash dividend of up to $ 28,000 to the Company’s parent entities on or within two months of the Third Amendment Effective Date (the “Third Amendment Effective Date Distribution”).

• The BRPAC Amended Credit Agreement, as amended by the Third Amendment, requires the BRPAC Borrowers to maintain (i) a Consolidated Total Funded Debt Ratio not to exceed 2.00x through September 30, 2026, with step-downs to 1.50x, 1.25x, and 1.00x in subsequent periods, and (ii) a Consolidated Fixed Charge Coverage Ratio of not less than 1.20x, tested quarterly beginning March 31, 2026.

The borrowings under the BRPAC Amended Credit Agreement, as amended, bear interest at the Term SOFR rate (one-month tenor) plus a margin of 2.75 % to 3.50 % per annum, depending on the BRPAC Borrowers’ Consolidated Total Funded Debt Ratio, subject to a minimum rate of 3.25 % per annum.

The obligations under the BRPAC Amended Credit Agreement are secured by first-priority liens on, and first-priority security interests in, substantially all of the assets of the BRPAC Borrowers totaling approximately $ 308,996 as of March 31, 2026 (which includes $ 13,380 of accounts receivable and $ 2,991 of inventory), including a pledge of (a) 100 % of the equity interests of the BRPAC Borrowers;

In connection with the Third Amendment, the BRPAC Borrowers are permitted to make an aggregate cash dividend of up to $ 28,000 to the Company’s parent entities on or within two months of the Amendment Effective Date.

The BRPAC Credit Agreement, as amended by the Third Amendment, requires the BRPAC Borrowers to maintain (i) a Consolidated Total Funded Debt Ratio not to exceed 2.00 x through September 30, 2026, with step-downs to 1.50 x, 1.25 x, and 1.00 x in subsequent periods, and (ii) a Consolidated Fixed Charge Coverage Ratio of not less than 1.20 x, tested quarterly beginning March 31, 2026.

For accounting purposes, the Third Amendment was considered a troubled debt restructuring.

As the future undiscounted cash payments under the terms of the modified debt exceeded the carrying amount of the debt on the modification date, no gain or loss was recognized, and the Company accounted for the restructuring on a prospective basis using the revised effective interest rate established under the Third Amendment.

The borrowings under the BRPAC Credit Agreement bear interest at the greater of (i) the one-month Term SOFR rate plus a margin of 2.75 % to 3.50 % per annum, depending on the BRPAC Borrowers’ Consolidated Total Funded Debt Ratio, or (ii) a 3.25 % per annum floor per annum.

Interest expense on the term loan during the three months ended June 30, 2026 and 2025 was $ 1,080 and $ 1,561 , respectively.

Interest expense on the term loan during the six months ended June 30, 2026 and 2025 was $ 2,261 and $ 3,151 , respectively.

The average borrowings under the Revolving Credit Facility was $ 16,000 during the six months ended June 30, 2026.

The amount available for borrowings under the Revolving Credit Facility was $ 4,000 at June 30, 2026.

Interest expense on the Revolving Credit Facility during the six months ended June 30, 2026 was $ 254 .

Interest expense on the term loan under the Prior Lingo Credit Agreement during the six months ended June 30, 2025 was $ 62 .

The obligations under the BRPAC Credit Agreement are secured by first-priority liens on, and first-priority security interests in, substantially all of the assets of the BRPAC Borrowers totaling approximately $ 292,723 as of June 30, 2026 (which includes $ 12,828 of accounts receivable and $ 2,848 of inventory), including a pledge of (a) 100 % of the equity interests of the BRPAC Borrowers;

(b) 65 % of the equity interests in United Online Software Development (India) Private Limited, a private limited company organized under the laws of India;

and (c) 65 % of the equity interests in magicJack VocalTec Ltd., an Israel corporation.

and (c) 65 % of the equity interests in magicJack

VocalTec Ltd., an Israel corporation.

Such security interests are evidenced by pledge, security, and other related agreements.

Interest expense on the term loan during the three months ended March 31, 2026 and 2025 was $ 1,181 and $ 1,590 , respectively.

The BRPAC Amended Credit Agreement contains certain covenants, including those limiting the Credit Parties’, and their subsidiaries’, ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends.

In addition, the BRPAC Amended Credit Agreement requires the Credit Parties to maintain certain financial ratios.

The BRPAC Amended Credit Agreement also contains customary representations and warranties, affirmative covenants, and events of default, including payment defaults, breach of representations and warranties, covenant defaults and cross defaults.

If an event of default occurs, the agent would be entitled to take various actions, including the acceleration of outstanding amounts due under the BRPAC Amended Credit Agreement.

The Company is in compliance with all financial covenants in the BRPAC Amended Credit Agreement as of March 31, 2026.

The BRPAC Credit Agreement contains certain covenants, including those limiting the Credit Parties’, and their subsidiaries’, ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends.

In addition, the BRPAC Credit Agreement requires the Credit Parties to maintain certain financial ratios.

The BRPAC Credit Agreement also contains customary representations and warranties, affirmative covenants, and events of default, including payment defaults, breach of representations and warranties, covenant defaults and cross defaults.

If an event of default occurs, the agent would be entitled to take various actions, including the acceleration of outstanding amounts due under the BRPAC Credit Agreement.

The Company is in compliance with all financial covenants in the BRPAC Credit Agreement as of June 30, 2026.

NOTE 15 — SENIOR NOTES PAYABLE

Senior notes payable, net, are comprised of the following:

Effective Interest Rate March 31,

Effective Interest Rate June 30,

2026 December 31,

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$ 1,129,966 $ 1,301,798

As of March 31, 2026 and December 31, 2025, the senior notes had a weighted average interest rate of 5.61 % and 5.60 %, respectively.

As of June 30, 2026 and December 31, 2025, the senior notes had a weighted average interest rate of 5.59 % and 5.60 %, respectively.

Interest on senior notes is payable on a quarterly basis.

Interest expense on senior notes totaled $ 15,004 and $ 21,654 during the three months ended March 31, 2026 and 2025, respectively.

Interest expense on senior notes totaled $ 12,905 and $ 17,236 during the three months ended June 30, 2026 and 2025, respectively.

Interest expense on senior notes totaled $ 27,909 and $ 38,890 during the six months ended June 30, 2026 and 2025, respectively.

The senior notes are unsecured obligations and are not secured by any of the Company’s or its subsidiaries’ assets and therefore are effectively subordinated to any existing and future secured indebtedness to the extent of the collateral securing such indebtedness.

During the three months ended March 31, 2026, the Company completed a series of Section 3(a)(9) Exchanges with the Investor whereby the Company exchanged an aggregate principal amount of $ 36,089 , of which $ 33,192 related to troubled debt restructurings, for an aggregate 4,553,866 of the Company’s common stock valued at approximately $ 33,500

based on stock prices ranging from $ 6.60 to $ 7.88 per share on the respective settlement dates.

The Investor owns more than five percent of the Company’s common stock.

As a result of the exchanges, the carrying value was reduced by $ 36,210 which was extinguished and the Company recorded a net gain on the extinguishment of debt of $ 2,621 in the “Gain (loss) on extinguishment of debt” line item in the accompanying condensed consolidated statements of operations.

The gain on the extinguishment of debt was comprised of a troubled debt restructuring gain of $ 2,704 , offset by a loss on extinguishment of $ 83 for the three months ended March 31, 2026.

During the six months ended June 30, 2026, the Company completed a series of Section 3(a)(9) Exchanges with the Investor.

During the three and six months ended June 30, 2026, the Company exchanged aggregate principal amounts of $ 32,965 and $ 69,054 , respectively of senior notes, including $ 9,297 and $ 42,490 , respectively related to troubled debt restructurings, for 3,804,629 and 8,358,495 of the Company’s common stock.

The shares issued had aggregate fair values of $ 34,284 and $ 67,784 , respectively, based on the closing market price of the Company's common stock on the applicable settlement dates, which ranged from $ 6.60 to $ 9.34 per share.

As a result of these exchanges, the carrying amount of the senior notes, together with related accrued interest, was reduced by $ 33,155 and $ 69,366 during the three and six months ended June 30, 2026, respectively.

The Company recognized a net loss on extinguishment of debt of $ 1,283 for the three months ended June 30, 2026, and a net gain on extinguishment of debt of $ 1,338 for the six months ended June 30, 2026, which is included in the “(Loss) gain on extinguishment of debt” line item in the accompanying condensed consolidated statements of operations.

During the three and six months ended June 30, 2026, the net loss and net gain consisted of troubled debt restructuring gains of $ 805 and $ 3,509 , respectively, offset by losses on extinguishment of $ 2,088 and $ 2,171 , respectively.

On March 10, 2026, the Company repurchased $ 4,293 of the 5.00 % Senior Notes due December 31, 2026 from the open market for $ 4,035 .

The repurchase was accounted for as a debt extinguishment, and the Company recognized a gain of $ 269 in the “Gain (loss) on extinguishment of debt” line item in the accompanying condensed consolidated statements of operations during the period.

The repurchase was accounted for as a debt extinguishment, and the Company recognized a gain

of $ 269 in the “(Loss) gain on extinguishment of debt” line item in the accompanying condensed consolidated statements of operations during six months ended June 30, 2026.

On March 30, 2026, the Company redeemed all of the $ 95,991 of issued and outstanding 5.50 % Senior Notes due March 31, 2026 (the “ 5.50 % 2026 Notes”).

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In connection with the full redemption, the 5.50 % 2026 Notes, which were listed on Nasdaq under the ticker symbol “RILYK,” were delisted from Nasdaq and ceased trading on the redemption date.

On March 26, 2025, the Company completed a private exchange transaction with an institutional investor pursuant to which the investor exchanged senior notes for the New Notes, whereupon the exchanged notes were cancelled.

The Company recorded a gain on the debt restructuring of $ 10,532 in the “Gain on senior note exchange” line item in the accompanying condensed consolidated statements of operations for the three months ended March 31, 2025.

The exchange represented a troubled debt restructuring.

During the six months ended June 30, 2025, the Company completed four private exchange transactions with institutional investors pursuant to which the investors exchanged senior notes for the New Notes, whereupon the exchanged notes were cancelled.

The Company recorded a gain on the debt restructuring of $ 44,784 and $ 55,316 in the “Gain on senior note exchange” line item in the accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2025, respectively.

Each of the exchanges represented a troubled debt restructuring.

The New Notes were issued pursuant to an indenture, dated as of March 26, 2025 (the “New Notes Indenture”), governing the issuance of New Notes dated March 26, 2025, April 7, 2025, May 21, 2025, June 30, 2025, and July 11, 2025 for the five private exchange transactions during 2025, between the Company, certain subsidiaries of the Company, as guarantors, and GLAS Trust Company LLC, a New Hampshire limited liability company, as trustee and collateral agent, and the New Notes are unconditionally guaranteed jointly and severally by all direct and indirect wholly-owned restricted subsidiaries of the Company, subject to certain excluded subsidiaries (collectively, the “Guarantors”).

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The New Notes Indenture contains certain covenants that, among other things, limit the Company’s and its subsidiaries’ ability to incur additional indebtedness or liens, to dispose of assets, to make certain fundamental changes, to enter into restrictive agreements, to make certain investments, loans, advances, guarantees and acquisitions, to prepay certain indebtedness and to pay dividends or to make other distributions or redemptions/repurchases in respect of their respective equity interests.

In connection with the issuance of warrants in conjunction with the private exchange transactions during 2025 (further described in Note 22 - Stockholder’s Equity), the Company entered into registration rights agreements with the investors, pursuant to which the Company granted such investors (i) certain shelf registration rights whereby the Company will register resales of the shares of Common Stock issued upon exercise of the warrants and (ii) certain piggyback registration rights, in each case subject to the terms and conditions set forth in the registration rights agreements.

The Company registered the shares of Common Stock underlying such warrants pursuant to a Registration Statement on Form S-1 (which was subsequently amended by a Post-Effective Amendment) and declared effective by the Securities and Exchange Commission in April 2026.

In connection with the issuance of warrants in conjunction with the private exchange transactions during 2025 (further described in Note 22 - Stockholders’ Equity), the Company entered into registration rights agreements with the investors, pursuant to which the Company granted such investors (i) certain shelf registration rights whereby the Company will register resales of the shares of Common Stock issued upon exercise of the warrants and (ii) certain piggyback registration rights, in each case subject to the terms and conditions set forth in the registration rights agreements.

The Company registered the shares of Common Stock underlying such warrants pursuant to a Registration Statement on Form S-1 (which was subsequently amended by a Post-Effective Amendment) (Reg.

333-293348) and declared effective by the Securities and Exchange Commission in April 2026.

NOTE 16 — NONCONTROLLING INTERESTS

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The Company also issued restricted stock awards as more fully described in Note 21(c) - BRSH Stock Incentive Plan and assuming the full issuance of the restricted stock awards are vested, the Company owned 89.4 % majority-interest in BRSH as of the date of the merger.

As of March 31, 2026 and December 31, 2025, the Company owned 91.8 % and 90.7 %, respectively.

As of June 30, 2026 and December 31, 2025, the Company owned 92.9 % and 90.7 %, respectively.

The shell corporation that merged with BRSH on March 10, 2025 did not meet the definition of a business, since it did not have any assets, liabilities, or operations and was treated as the initial recognition of a variable interest entity, as more fully described in Note 3 - Variable Interest Entities.

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NOTE 17 — REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue from contracts with customers from the Company’s seven reportable operating segments and the Corporate and All Other category during the three months ended March 31, 2026 and 2025 is reported below.

Revenue from contracts with customers from the Company’s seven reportable operating segments and the Corporate and All Other category during the three and six months ended June 30, 2026 and 2025 is reported below.

Markets Wealth

Management Lingo magicJack Marconi Wireless UOL Consumer Products Corporate & All Other Total

Revenues for the three months ended March 31, 2026:

Revenues for the three months ended June 30, 2026:

Corporate finance, consulting and investment banking fees (1)

$ 36,310 $ — $ — $ — $ — $ — $ — $ ( 2,363 ) $ 33,947

Wealth and asset management fees — 28,438 — — — — — 551 28,989

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Total revenues $ 53,712 $ 57,953 $ 38,788 $ 8,567 $ 7,368 $ 2,881 $ 43,537 $ 26,311 $ 239,117

(1) Corporate finance, consulting and investment banking fees for the Corporate & All Other category represents intercompany sales.

(2) Advertising and other revenues for the Corporate and All Other category primarily consist of bebe’s revenues from merchandise rental fees.

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Management Lingo magicJack Marconi Wireless UOL Consumer Products Corporate & All Other Total

Revenues for the three months ended March 31, 2025:

Revenues for the three months ended June 30, 2025:

Corporate finance, consulting and investment banking fees $ 32,346 $ — $ — $ — $ — $ — $ — $ — $ 32,346

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Total revenues from contracts with customers 36,864 31,949 39,907 9,777 9,232 3,287 43,284 13,866 188,166

Trading (losses) gains, net ( 17,266 ) 612 — — — — — 483 ( 16,171 )

Trading gains, net 21,249 5,200 — — — — — 1,231 27,680

Fair value adjustments on loans — — — — — — — 800 800

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(1) Advertising and other revenues for the Corporate and All Other category primarily consist of bebe’s revenues from merchandise rental fees.

Markets Wealth

Management Lingo magicJack Marconi Wireless UOL Consumer Products Corporate & All Other Total

Revenues for the six months ended June 30, 2026

Corporate finance, consulting and investment banking fees (1)

$ 65,044 $ — $ — $ — $ — $ — $ — $ ( 3,638 ) $ 61,406

Wealth and asset management fees — 56,657 — — — — — 2,140 58,797

Commissions, fees and reimbursed expenses 13,556 5,895 — — — — — 41 19,492

Subscription services — — 79,578 15,754 13,904 4,744 — — 113,980

Sale of goods — — — 596 1,001 — 87,652 718 89,967

Advertising and other (2)

— — — 1,000 — 958 — 22,306 24,264

Total revenues from contracts with customers 78,600 62,552 79,578 17,350 14,905 5,702 87,652 21,567 367,906

Trading gains (losses), net 139,666 19,347 — — — — — ( 1,078 ) 157,935

Fair value adjustments on loans 751 — — — — — — 10,039 10,790

Interest income - loans 1,034 — — — — — — 2,851 3,885

Interest income - securities lending 2,883 — — — — — — — 2,883

Other 2,889 28,229 — — — — — 16,660 47,778

Total revenues $ 225,823 $ 110,128 $ 79,578 $ 17,350 $ 14,905 $ 5,702 $ 87,652 $ 50,039 $ 591,177

(1) Corporate finance, consulting and investment banking fees for the Corporate & All Other category represents intercompany sales.

(2) Advertising and other revenues for the Corporate and All Other category primarily consist of bebe’s revenues from merchandise rental fees.

Markets Wealth

Management Lingo magicJack Marconi Wireless UOL Consumer Products Corporate & All Other Total

Revenues for the six months ended June 30, 2025

Corporate finance, consulting and investment banking fees (1)

$ 49,723 $ — $ — $ — $ — $ — $ — $ 352 $ 50,075

Wealth and asset management fees — 66,602 — — — — — 1,831 68,433

Commissions, fees and reimbursed expenses 7,816 6,195 — — — — — 122 14,133

Subscription services — — 81,460 17,765 16,606 5,975 — — 121,806

Sale of goods — — — 659 2,113 — 85,387 4,369 92,528

Advertising and other (2)

— — — 1,154 — 945 — 36,319 38,418

Total revenues from contracts with customers 57,539 72,797 81,460 19,578 18,719 6,920 85,387 42,993 385,393

Trading gains, net 3,983 5,812 — — — — — 1,714 11,509

Fair value adjustments on loans ( 3,131 ) — — — — — — ( 4,165 ) ( 7,296 )

Interest income - loans 65 — — — — — — 6,984 7,049

Interest income - securities lending 2,964 — — — — — — — 2,964

Other 1,972 7,290 — — — — — 2,484 11,746

Total revenues $ 63,392 $ 85,899 $ 81,460 $ 19,578 $ 18,719 $ 6,920 $ 85,387 $ 50,010 $ 411,365

(1) Corporate finance, consulting and investment banking fees for the Corporate and All Other category represents intercompany sales.

(2) Advertising and other revenues for the Corporate and All Other category primarily consist of bebe’s revenues from merchandise rental fees.

These also include recycling processing fees for a regional environmental services business, which was sold in March 2025, and managed service fees for Nogin, an e-commerce, technology platform provider, through March 31, 2025.

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The Company’s deferred revenue primarily relates to retainer and milestone fees received from corporate finance and investment banking advisory engagements, asset management agreements, financial consulting engagements, and subscription services where the performance obligation has not yet been satisfied.

The following table presents changes in deferred revenue during the three months ended March 31, 2026:

Balance as of December 31, 2025 $ 49,907

The following table presents changes in deferred revenue during the six months ended June 30, 2026 and 2025:

Six Months Ended June 30, 2026 Six Months Ended June 30, 2025

Balance, beginning of period $ 49,907 $ 58,148

Additions to deferred revenue during the period 68,757 77,285

Reductions to deferred revenue for revenue recognized during the period ( 71,679 ) ( 81,934 )

Balance as of March 31, 2026 $ 48,730

During the three months ended March 31, 2026 and 2025, the Company recognized revenue of $ 16,560 and $ 17,241 , respectively, that was recorded as deferred revenue at the beginning of the period.

The Company expects to recognize the deferred revenue of $ 48,730 as of March 31, 2026 as service and fee revenues when the performance obligation is met during the years ended December 31, 2026 (remaining nine months), 2027, 2028, 2029 and 2030 in the amount of $ 32,437 , $ 7,939 , $ 3,809 , $ 1,492 , and $ 848 , respectively.

Balance, end of period $ 46,985 $ 53,499

During the six months ended June 30, 2026 and 2025 the Company recognized revenue of $ 22,581 and $ 25,033 that was recorded as deferred revenue at the beginning of the period.

The Company expects to recognize the deferred revenue of $ 46,985 as of June 30, 2026 as service and fee revenues when the performance obligation is met during the years ended December 31, 2026 (remaining six months), 2027, 2028, 2029 and 2030 in the amount of $ 30,491 , $ 8,008 , $ 4,194 , $ 1,350 , and $ 772 , respectively.

The Company expects to recognize the deferred revenue of $ 2,170 after December 31, 2030.

The following table contains a rollforward of unbilled receivables, which are included in prepaid expenses and other assets, for the three months ended March 31, 2026:

Balance as of December 31, 2025 $ 2,727

The following table contains a rollforward of unbilled receivables, which are included in prepaid expenses and other assets, for the six months ended June 30, 2026 and 2025:

Six Months Ended June 30, 2026 Six Months Ended June 30, 2025

Balance, beginning of period $ 2,727 $ 3,387

Additional unbilled revenue recognized 2,248 3,172

Amounts billed to customers ( 2,795 ) ( 3,415 )

Balance as of March 31, 2026 $ 2,439

Balance, end of period $ 2,180 $ 3,144

Contract Costs

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(2) commissions paid to obtain magicJack contracts which are recognized ratably over the contract term and third party support costs for magicJack and related equipment purchased by customers which are recognized ratably over the service period.

The capitalized costs to fulfill a contract were $ 4,533 and $ 4,550 as of March 31, 2026 and December 31, 2025, respectively, and are recorded in the “Prepaid expenses and other assets” line item in the accompanying unaudited condensed consolidated balance sheets.

For the three months ended March 31, 2026 and 2025, the Company recognized expenses of $ 852 and $ 1,060 related to capitalized costs to fulfill a contract, respectively.

There were no significant impairment charges recognized in relation to these capitalized costs during the three months ended March 31, 2026 and 2025.

The capitalized costs to fulfill a contract were $ 4,645 and $ 4,550 as of June 30, 2026 and December 31, 2025, respectively, and are recorded in the “Prepaid expenses and other assets” line item in the accompanying unaudited condensed consolidated balance sheets.

For the three months ended June 30, 2026 and 2025, the Company recognized expenses of $ 785 and $ 1,034 related to capitalized costs to fulfill a contract, respectively.

During the six months ended June 30, 2026 and 2025, the Company recognized expenses of $ 1,637 and $ 2,094 related to capitalized costs to fulfill a contract, respectively.

There were no significant impairment charges recognized in relation to these capitalized costs during the three and six months ended June 30, 2026 and 2025.

Remaining Performance Obligations and Revenue Recognized from Past Performance

The Company does not disclose information about remaining performance obligations pertaining to contracts that have an original expected duration of one year or less.

The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material as of March 31, 2026.

Corporate finance and investment banking fees that are contingent upon completion of a specific

milestone and fees associated with certain distribution services are also excluded as the fees are considered variable and not included in the transaction price as of March 31, 2026.

During the three months ended March 31, 2026 and 2025, revenues recognized for customer contracts for performance obligations that are satisfied at a point in time and over time were:

Three Months Ended March 31,

The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material as of June 30, 2026.

Corporate finance and investment banking fees that are contingent upon completion of a specific milestone and fees associated with certain distribution services are also excluded as the fees are considered variable and not included in the transaction price as of June 30, 2026.

During the three and six months ended June 30, 2026, and 2025, revenues recognized for customer contracts for performance obligations that are satisfied at a point in time and over time were:

Three Months Ended

Six Months Ended

2026 2025 2026 2025

Revenue recognized at a point in time

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NOTE 18 — RESTRUCTURING CHARGE

During the three months ended March 31, 2026 and 2025, there were no restructuring charges for the Company.

The following table summarizes the changes in accrued restructuring charge during the three months ended March 31, 2026 and 2025:

The Company recorded restructuring charges of $ 1,914 and $ 321 during the three and six months ended June 30, 2026, and 2025, respectively, which are included in “Restructuring charge” in the accompanying unaudited condensed consolidated statements of operations.

The $ 1,914 of restructuring charges recorded during the three and six months ended June 30, 2026 were in connection with organizational realignments and consisted of severance and related costs consistent with the Company's historical severance practices across the following segments:

$ 1,757 related to Capital Markets, $ 128 related to Consumer Products, and $ 29 related to Wealth Management.

The Company continues to evaluate its organizational structure and may incur additional restructuring charges in future periods.

The $ 321 of restructuring charges recorded during the three and six months ended June 30, 2025 consisted of reductions in workforce, of which $ 285 was attributable to the Corporate and All Other category and $ 36 was attributable to the Consumer Products segment.

The following table summarizes the changes in accrued restructuring charge during the three and six months ended June 30, 2026 and 2025:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Balance, beginning of period $ 295 $ 840 $ 361 $ 1,316

Restructuring charge 1,914 321 1,914 321

Cash paid ( 1,682 ) ( 305 ) ( 1,767 ) ( 726 )

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NOTE 19 — INCOME TAXES

The Company’s effective income tax rate was a provision of 7.1 % for the three months ended March 31, 2026, as compared to a benefit of 13.2 % for the three months ended March 31, 2025.

During the three months ended March 31, 2026, the Company had a provision for income taxes from continuing operations of $ 16,891 is primarily comprised of the estimated federal, state, and foreign taxes based on the expected annual effective income tax rate for 2026 that includes the impact of the utilization of net operating loss carryforwards and disallowed interest expense carried forward from prior years.

During the three months ended March 31, 2025, the benefit for income taxes from continuing operations of $ 3,042 resulted primarily from the impact of the release of tax contingencies during the period.

The effective income tax rate for the three months ended March 31, 2026 is less than the federal statutory tax rate of 21%, primarily due to the expected utilization of net operating losses and the Company continuing to have a full valuation allowance.

The effective income tax rate for the three months ended March 31, 2025 was less than the federal statutory tax rate of 21% due to the loss generated during the period with a full valuation allowance.

The Company’s effective income tax rate was a provision of 21.6 % for the three months ended June 30, 2026, as compared to a provision of 4.1 % for the three months ended June 30, 2025.

The Company’s effective income tax rate was a provision of 8.6 % for the six months ended June 30, 2026, as compared to a provision of less than 1.0 % for the six months ended June 30, 2025.

During the three months ended June 30, 2026, the Company had a provision for income taxes from continuing operations of $ 5,950 , which is primarily comprised of the estimated federal, state, and foreign taxes based on the expected annual effective income tax rate for 2026 that includes the impact of the utilization of net operating loss carryforwards and disallowed interest expense carried forward from prior years.

During the three months ended June 30, 2025, the provision for income taxes from continuing operations of $ 3,053 resulted primarily from the impact of recording uncertain tax positions for state and foreign taxes, interest and penalties.

During the six months ended June 30, 2026, the Company had a provision for income taxes from continuing operations of $ 22,841 .

During the six months ended June 30, 2025, the Company had a provision for income taxes from continuing operations of $ 11 .

The effective income tax rate for the six months ended June 30, 2026 is less than the federal statutory tax rate of 21%, primarily due to the expected utilization of net operating losses, carryforwards, disallowed interest expense carried forward from prior years and the Company continuing to have a full valuation allowance.

The effective income tax rate for the six months ended June 30, 2025 was less than the federal statutory tax rate of 21% primarily due to the utilization of capital loss carryforwards to offset the gain on sale and deconsolidation of businesses and the Company having a full valuation allowance.

As of December 31, 2025, the Company had federal net operating loss carryforwards of $ 602,913 and state net operating loss carryforwards of $ 688,239 , which are available to offset taxable income.

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The Company’s net operating losses are subject to annual limitations in accordance with Internal Revenue Code Section 382.

Accordingly, the Company is limited to the amount of net operating loss that may be utilized in future taxable years depending on the Company’s actual taxable

As of March 31, 2026 and December 31, 2025, a full valuation allowance has been recorded since it is more likely than not that the Company will not be able to utilize tax benefits before they expire.

Accordingly, the Company is limited to the amount of net operating loss that may be utilized in future taxable years depending on the Company’s actual taxable income.

As of June 30, 2026 and December 31, 2025, a full valuation allowance has been recorded since it is more likely than not that the Company will not be able to utilize tax benefits before they expire.

The Company reassesses the need for a valuation allowance on an ongoing basis.

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NOTE 20 — EARNINGS PER SHARE

Basic earnings per share is calculated by dividing income (loss) from continuing operations, income from discontinued operations, or net income (loss) by the weighted-average number of shares outstanding during the period.

Diluted earnings per share is calculated by dividing income (loss) from continuing operations, income from discontinued operations, or net income (loss) by the weighted-average number of common shares outstanding, after giving effect to all dilutive potential common shares outstanding during the period.

Basic earnings per share is calculated by dividing income from continuing operations, income from discontinued operations, or net income by the weighted-average number of shares outstanding during the period, including contingently issuable shares.

Diluted earnings per share is calculated by dividing income from continuing operations, income from discontinued operations, or net income by the weighted-average number of common shares outstanding, after giving effect to all dilutive potential common shares outstanding during the period.

Dilutive potential common shares include shares that may be issued under warrants, including warrants issued in connection with the Oaktree Credit Agreement and private debt exchange transactions, and restricted stock and stock option awards.

Securities that could potentially dilute basic net income per share in the future that were not included in the computation of diluted net income per share as the effect would be anti-dilutive were 3,305,502 and 2,483,159 during the three months ended March 31, 2026 and 2025, respectively.

As of May 29, 2026, the Oaktree Warrants issued in connection with the Oaktree Credit Agreement were exercised and are no longer outstanding.

Securities that could potentially dilute basic net income per share in the future that were not included in the computation of diluted net income per share as the effect would be anti-dilutive were 1,350,215 and 3,229,165 during the three and six months ended June 30, 2026 and 2025, respectively.

Basic and diluted earnings per share were calculated as follows:

Three Months Ended March 31,

Three Months Ended June 30,

Continuing Operations Discontinued Operations Total Continuing Operations Discontinued Operations Total

Net income (loss) $ 222,159 $ — $ 222,159 $ ( 19,962 ) $ 3,395 $ ( 16,567 )

Net income $ 21,597 $ — $ 21,597 $ 71,687 $ 69,312 $ 140,999

Net income attributable to noncontrolling interests 1,048 — 1,048 1,528 — 1,528

Net income attributable to Registrant 20,549 — 20,549 70,159 69,312 139,471

Preferred stock dividends 2,015 — 2,015 2,015 — 2,015

Net income available to common shareholders $ 18,534 $ — $ 18,534 $ 68,144 $ 69,312 $ 137,456

Change in fair value of warrants and gain on warrant exercise ( 1,331 ) — ( 1,331 ) — — —

Diluted net income attributable to common stockholders $ 17,203 $ — $ 17,203 $ 68,144 $ 69,312 $ 137,456

Six Months Ended June 30,

Continuing Operations Discontinued Operations Total Continuing Operations Discontinued Operations Total

Net income $ 243,756 $ — $ 243,756 $ 51,725 $ 72,707 $ 124,432

Net income (loss) attributable to noncontrolling interests 9,934 — 9,934 ( 5,064 ) — ( 5,064 )

Net income (loss) attributable to Registrant 213,273 — 213,273 ( 13,370 ) 3,395 ( 9,975 )

Net income attributable to Registrant 233,822 — 233,822 56,789 72,707 129,496

Preferred stock dividends 4,030 — 4,030 4,030 — 4,030

Net income (loss) available to common shareholders $ 211,258 $ — $ 211,258 $ ( 15,385 ) $ 3,395 $ ( 11,990 )

Net income available to common shareholders $ 229,792 $ — $ 229,792 $ 52,759 $ 72,707 $ 125,466

Change in fair value of warrants and gain on warrant exercise ( 1,331 ) — ( 1,331 ) — — —

Diluted net income attributable to common stockholders $ 228,461 $ — $ 228,461 $ 52,759 $ 72,707 $ 125,466

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Weighted average common shares outstanding:

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Effect of dilutive potential common shares:

Restricted stock units, warrants, and stock options 251,392 —

Restricted stock units, stock options and warrants 611,154 — 431,273 —

Diluted 38,422,185 30,527,835 35,311,001 30,512,757

Basic net income (loss) per common share:

Basic net income per common share:

Continuing operations $ 0.49 $ 2.23 $ 6.59 $ 1.73

Discontinued operations — 2.27 — 2.38

Basic income (loss) per common share $ 6.62 $ ( 0.39 )

Diluted net income (loss) per common share:

Basic income per common share $ 0.49 $ 4.50 $ 6.59 $ 4.11

Diluted net income per common share:

Continuing operations $ 0.45 $ 2.23 $ 6.47 $ 1.73

Discontinued operations — 2.27 — 2.38

Diluted income (loss) per common share $ 6.57 $ ( 0.39 )

Diluted income per common share $ 0.45 $ 4.50 $ 6.47 $ 4.11

NOTE 21 — SHARE-BASED PAYMENTS

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Three Months Ended

Six Months Ended

2026 2025 2026 2025

Share-based compensation expense for restricted stock units for continuing operations $ 2,818 $ 2,649 $ 4,458 $ 5,658

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Total share-based compensation expense for restricted stock units $ 2,818 $ 3,471 $ 4,458 $ 6,696

During the three months ended March 31, 2026, in connection with employee stock incentive plans, the Company did not grant any restricted stock units.

On April 3, 2026, the Company granted 308,514 restricted stock units (“RSUs”), with a grant date fair value of $ 2,099 to its six non-employee directors under the Company’s 2021 Stock Incentive Plan.

The awards consisted of:

(i) 21,960 RSUs that vested immediately on the grant date;

(ii) 88,170 RSUs that vested on the earlier of the Company's 2026 Annual Meeting of Stockholders or December 1, 2026 subject to the director's continued service, which vested on May 19, 2026, the date of the 2026 Annual Meeting of Stockholders;

and (iii) 198,384 RSUs that vest on the one-year anniversary of the grant date, subject to continued service.

For five of the six non-employee directors, the post-grant service period associated with the third award was determined to be non-substantive because those directors were retirement-eligible under the terms of the award following the 2026 Annual Meeting of Stockholders;

accordingly, those awards were considered vested and the resulting share-based expense was accelerated for accounting purposes on May 19, 2026.

The grant-date fair value of the RSUs was based on the closing market price of the Company's common stock on the trading day prior to the grant date.

During the six months ended June 30, 2026, 17,405 RSUs were forfeited.

Share-based compensation expense is recorded in the “Selling, general and administrative expenses” line item in the accompanying unaudited condensed consolidated statements of operations.

As of March 31, 2026, the Company’s Registration Statement on Form S-8 covering the Company’s 2021 Stock Incentive Plan became effective.

As a result, the Company intends to settle vested restricted stock units in shares of common stock to be issued in accordance with such plan.

The restricted stock units were reclassified to equity and the change in classification was accounted for as a modification.

The Company continues to recognize compensation expense based on the grant date fair value of the original award and no additional compensation expense was recognized.

The fair value of the liability on the modification date was $ 2,589 and was reclassified from “Accrued expenses and other liabilities” to the “Additional paid-in capital” line item in the accompanying unaudited condensed consolidated balance sheets.

Prior to the modification, the Company’s restricted stock units were classified as a liability.

The liability represented the fair value of the restricted stock units that had not been settled through the balance sheet date for which the requisite services had been provided by the employees.

The fair value of the liability at each balance sheet date was determined based on the Company’s stock price.

As of December 31, 2025, the liability was $ 1,274 .

The changes in fair value of the liability at the end of the reporting period do not impact earnings.

For the three months ended March 31, 2025, the Company settled $ 1,862 of restricted stock units in cash.

(b) Employee Stock Purchase Plan

In connection with the Company’s Employee Stock Purchase Plan (the “Purchase Plan”), there was no share-based compensation expense during the three months ended March 31, 2026 and 2025.

As of March 31, 2026, there were 236,949 shares reserved for issuance under the Purchase Plan.

In connection with the Company’s Employee Stock Purchase Plan (the “Purchase Plan”), there was no share-based compensation expense during the three and six months ended June 30, 2026 and 2025.

As of June 30, 2026, there were 236,949 shares reserved for issuance under the Purchase Plan.

On March 10, 2025, the Company’s majority-owned subsidiary approved the BRSH Stock Incentive Plan which allows for issuance of up to 4,000,000 restricted stock awards of BRSH.

No restricted stock awards of BRSH were granted during the three months ended March 31, 2026 and there is no intention to issue restricted stock awards of BRSH after the date hereof.

No restricted stock awards of BRSH were granted during the six months ended June 30, 2026 and there is no intention to issue restricted stock awards of BRSH after the date hereof.

The restricted stock awards granted generally vest over a period of four to five years , based on continued service.

The restricted stock awards vest for common stock of BRSH and increase the noncontrolling interest in BRSH, when vested.

During the three months ended March 31, 2026 and 2025, share-based compensation expense of $ 756 and $ 293 , respectively, related to the BRSH restricted stock awards was recorded in the “Selling, general and administrative expenses” line item in the accompanying unaudited condensed consolidated statements of operations.

On March 10, 2026, 269,347 restricted stock awards vested, of which 107,071 shares valued at $ 1,902 were withheld to satisfy tax withholding obligations, resulting in the net issuance of 162,276 shares.

During the three months ended March 31, 2026, 118,797 awards were forfeited.

This activity, including shares withheld to satisfy tax withholding obligations, contributed to changes in noncontrolling interest, as more fully described in Note 16 – Noncontrolling Interest.

During the three months ended June 30, 2026 and 2025, share-based compensation expense of $ 365 and $ 1,277 , respectively, and during the six months ended June 30, 2026 and 2025, share-based compensation expense of $ 1,121 and $ 1,570 , respectively, related to the BRSH restricted stock awards was recorded in the “Selling, general and administrative expenses” line item in the accompanying unaudited condensed consolidated statements of operations.

During the six months ended June 30, 2026, 272,157 restricted stock awards vested, of which 107,071 shares valued at $ 1,902 were withheld to satisfy tax withholding obligations, resulting in the net issuance of 165,086 shares.

During the six months ended June 30, 2026, 339,530 awards were forfeited.

This activity, including shares withheld to satisfy tax

withholding obligations, contributed to changes in noncontrolling interest, as more fully described in Note 16 – Noncontrolling Interest.

(d) Common Stock and Stock Options Issued

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The maximum term of the stock options is 10 years.

During the three months ended March 31, 2026, share-based compensation expense for the options totaled $ 44 .

At June 30, 2026, 200,001 of the 300,000 options to purchase shares of the Company’s common stock were unvested.

During the three and six months ended June 30, 2026, share-based compensation expense for the options totaled $ 43 and $ 87 respectively.

During the three and six months ended June 30, 2025, share-based compensation expense for the options totaled $ 14 .

NOTE 22 — STOCKHOLDERS’ EQUITY

(a) Common Stock Warrants

In connection with the Oaktree Credit Agreement, on February 26, 2025 (refer to Note 14 - Term Loans and Revolving Credit Facility), the Company issued seven-year warrants to certain affiliates of Oaktree (the “Holders”) to purchase approximately 1,832,290 shares (or 6 % on a fully diluted basis) of the Company’s common stock at an exercise price of $ 5.14 per share.

The warrants contain certain anti-dilution provisions pursuant to which, under certain circumstances, the Holders would be entitled to exercise the warrants for up to 19.9 % of the then-outstanding shares of common stock.

The warrants were classified as a liability.

The warrant liability had an estimated fair value of $ 11,080 and $ 6,400 as of March 31, 2026 and December 31, 2025, respectively, which is included in other liabilities in Note 13 - Accrued Expenses and Other Liabilities.

The change in fair value of the warrant liability resulted in a (loss) gain of $( 4,680 ) and $ 2,700 during the three months ended March 31, 2026 and 2025, respectively, and is included in the “Change in fair value of financial instruments and other” line item in the accompanying unaudited condensed consolidated statements of operations.

See Note 5 - Fair Value Measurements for further details.

In connection with the Oaktree Credit Agreement, on February 26, 2025 (refer to Note 14 - Term Loans and Revolving Credit Facilities), the Company issued seven-year warrants to the Oaktree Holders to purchase approximately 1,832,290 shares (or 6 % on a fully diluted basis) of the Company’s common stock at an exercise price of $ 5.14 per share.

The Oaktree Warrants contain certain anti-dilution provisions pursuant to which, under certain circumstances, the Oaktree Holders would be entitled to exercise the warrants for up to 19.9 % of the then-outstanding shares of common stock.

The Oaktree Warrants were classified as a liability.

The shares underlying the Oaktree Warrants are registered for resale on Form S-1 (which was subsequently amended by a Post-Effective Amendment) (Reg.

On May 28, 2026, immediately prior to exercise, the Oaktree Warrants were remeasured to fair value, resulting in a fair value of $ 15,810 .

The Oaktree Holders exercised the Oaktree Warrants through a cashless exercise in accordance with the terms of the warrants, resulting in the issuance of an aggregate of 915,251 shares of the Company’s common stock to the Oaktree Holders in full settlement of the warrants.

Upon settlement, the Company recognized a gain on settlement of the warrants of $ 6,410 , representing the difference between the fair value of the Oaktree Warrants immediately prior to exercise of $ 15,810 and the fair value of the Company's common stock issued in settlement of the warrants of $ 9,400 , based on the Company's closing stock price of $ 10.27 per share on the settlement date.

The gain is included in the "Change in fair value of financial instruments and other" line item in the accompanying unaudited condensed consolidated statements of operations.

As a result of the exercise, the Oaktree Warrants were settled and no warrant liability remained outstanding as of June 30, 2026.

The warrant liability had an estimated fair value of $ 6,400 as of December 31, 2025 which is included in other liabilities in Note 13 - Accrued Expenses and Other Liabilities.

During the three and six months ended June 30, 2026, the change in the fair value of the warrant liability, including the final remeasurement immediately prior to exercise, resulted in a loss of $ 4,730 and $ 9,410 , respectively, and a gain of $ 1,000 and $ 3,700 during the three and six months ended June 30, 2025, respectively, and is included in the “Change in fair value of financial instruments and other” line item in the accompanying unaudited condensed consolidated statements of operations.

See Note 5 - Fair Value Measurements further details.

In conjunction with the debt exchanges (see Note 15 - Senior Notes Payable), the Company issued seven-year warrants to the investors to purchase up to 913,692 shares of common stock at an exercise price of $ 10.00 .

The warrants contain certain anti-dilution provisions and upon exercise, the warrant holders are entitled to dividends and distributions as if the warrants had been exercised in full prior to the dividend or distribution date.

The warrants meet the definition of a derivative and were classified within stockholder’s equity.

The warrants meet the definition of a derivative and were classified within stockholders’ equity.

(b) Preferred Stock

There were 2,834 shares of the Series A Preferred Stock issued and outstanding as of March 31, 2026 and December 31, 2025.

The total liquidation preference for the Series A Preferred Stock as of March 31, 2026 and December 31, 2025 was $ 76,943 (inclusive of cumulative unpaid dividends of $ 6,089 ) and $ 75,725 (inclusive of cumulative unpaid dividends of $ 4,871 ), respectively.

There were no dividends declared or paid on the Series A Preferred Stock during the three months ended March 31, 2026 and 2025.

There were 2,834 shares of the Series A Preferred Stock issued and outstanding as of June 30, 2026 and December 31, 2025.

The total liquidation preference for the Series A Preferred Stock as of June 30, 2026 and December 31, 2025 was $ 78,161 (inclusive of cumulative unpaid dividends of $ 7,307 ) and $ 75,725 (inclusive of cumulative unpaid dividends of $ 4,871 ), respectively.

There were no dividends declared or paid on the Series A Preferred Stock during the three and six months ended June 30, 2026 and 2025.

On January 21, 2025, the Company announced that it had temporarily suspended dividends on its Series A Preferred Stock.

Unpaid dividends will accrue until paid in full.

There were 1,729 shares of the Series B Preferred Stock issued and outstanding as of March 31, 2026 and December 31, 2025.

The total liquidation preference for the Series B Preferred Stock as of March 31, 2026 and December 31, 2025 was $ 47,214 (inclusive of cumulative unpaid dividends of $ 3,985 ) and $ 46,416 (inclusive of cumulative unpaid dividends of $ 3,188 ), respectively.

There were no dividends declared or paid on the Series B Preferred Stock during the three months ended March 31, 2026 and 2025.

There were 1,729 shares of the Series B Preferred Stock issued and outstanding as of June 30, 2026 and December 31, 2025.

The total liquidation preference for the Series B Preferred Stock as of June 30, 2026 and December 31, 2025 was $ 48,011 (inclusive of cumulative unpaid dividends of $ 4,782 ) and $ 46,416 (inclusive of cumulative unpaid dividends of $ 3,188 ), respectively.

There were no dividends declared or paid on the Series B Preferred Stock during the three and six months ended June 30, 2026 and 2025.

On January 21, 2025, the Company announced that it had temporarily suspended dividends on its Series B Preferred Stock.

Unpaid dividends will accrue until paid in full.

On April 30, 2026, the sixth quarterly Dividend Period (as defined in the applicable Certificate of Designation) for which dividends on the Series A Preferred Stock and Series B Preferred Stock have not been paid since the suspension occurred, resulting in a “Preferred Dividend Default” under each Certificate of Designation.

See Note 27 — Subsequent Events.

On April 30, 2026, the Company did not pay the quarterly dividend that would otherwise have been payable on its Series A Preferred Stock and Series B Preferred Stock for the Dividend Period (as defined in the applicable Certificate of Designation) ended April 30, 2026.

This was the sixth quarterly Dividend Period for which dividends on the Series A Preferred Stock and Series B Preferred Stock have not been paid since the Company’s announcement on January 21, 2025 of the temporary suspension of preferred dividends.

As a result, a “Preferred Dividend Default” has occurred under each Certificate of Designation.

Pursuant to each Certificate of Designation, upon the occurrence of a Preferred Dividend Default, the size of the Company’s Board of Directors is automatically increased by two seats, and the holders of the Series A Preferred Stock and the Series B Preferred Stock (voting together as a single class with the holders of any other parity preferred stock with similar voting rights then exercisable) become entitled to elect two additional directors to the Board of Directors (the “Preferred Directors”) until all dividends accumulated and unpaid on the Series A Preferred Stock and Series B Preferred Stock for all past Dividend Periods shall have been fully paid.

The election of Preferred Directors will take place at (i) either (A) a special meeting called in accordance with the Certificate of Designation requirements and the Company’s by-laws if the request is received more than 90 days before the date fixed for the Corporation’s next annual or special meeting of stockholders or (B) the next annual or special meeting of stockholders if the request is received within 90 days of the date fixed for the Corporation’s next annual or special meeting of stockholders, and (ii) at each subsequent annual meeting of stockholders, or special meeting at which Preferred Directors are to be elected, until the right of holders of Series A Preferred Stock and Series B Preferred Stock to elect Preferred Directors shall have terminated.

As of the date of this Quarterly Report, the Company has not received a written demand from holders that satisfies the requirements of the Company’s Certificates of Designation and by-laws of the Series A Preferred Stock or Series B Preferred Stock to call a special meeting for the election of Preferred Directors.

NOTE 23 — NET CAPITAL REQUIREMENTS

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NOTE 24 — RELATED PARTY TRANSACTIONS

For bebe’s rent to own stores that are franchised through Freedom VCM, during the three months ended March 31, 2025, royalty fees, marketing, and IT services charged to bebe by Freedom VCM totaled $ 1,217 , and inventory purchases by bebe from Freedom VCM totaled $ 2,861 .

For bebe’s rent to own stores that are franchised through Freedom VCM, during the three and six months ended June 30, 2025, royalty fees, marketing, and IT services charged to bebe by Freedom VCM totaled $ 1,068 and $ 2,285 respectively, and inventory purchases by bebe from Freedom VCM totaled $ 2,478 and $ 5,339 , respectively.

In June 2020, the Company entered into an investment advisory services agreement with Whitehawk Capital Partners, L.P.

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In addition, subject to the achievement of certain performance objectives as determined by B&W’s compensation committee of the board, a bonus or bonuses may also be earned and payable to the Company.

On September 20, 2024, Kenny Young resigned from his position as the President of the Company, the Executive Consulting Agreement with B&W was terminated, and concurrently, Kenny Young entered into a one-year consulting agreement to provide services to the Company, pursuant to which he was paid an annual fee of $ 250 paid on a monthly basis, subject to deduction of damages, fees and expenses that he may owe to the Company pursuant to this agreement.

damages, fees and expenses that he may owe to the Company pursuant to this agreement.

The consulting agreement expired on September 20, 2025 in accordance with its original terms.

During the three months ended March 31, 2026 and 2025, the Company earned $ 5,923 and $ 836 , respectively, of underwriting and financial advisory and other fees from B&W in connection with B&W’s capital raising activities which are included in services and fees in the accompanying unaudited condensed consolidated statements of operations.

During the three months ended June 30, 2026 and 2025, the Company earned $ 6,576 and $ 2,982 , respectively, and during the six months ended June 30, 2026 and 2025, the Company earned $ 12,499 and $ 3,818 , respectively, of underwriting and financial advisory and other fees from B&W in connection with B&W’s capital raising activities which are included in services and fees in the accompanying unaudited condensed consolidated statements of operations.

The Company is also a party to indemnification agreements for the benefit of B&W and the B.

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On November 3, 2024, Freedom VCM filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code which impacted the Freedom VCM equity interest, which served as the collateral for this loan receivable.

Fair value adjustments on the VCM loan receivable were increases of $ 20 and $ 276 during the three months ended March 31, 2026 and 2025, respectively.

Fair value adjustments on the VCM loan receivable were zero and a decrease of $( 866 ) during the three months ended June 30, 2026 and 2025, respectively.

Fair value adjustments on the VCM loan receivable were an increase and (decrease) of $ 20 and $( 589 ) during the six months ended June 30, 2026 and 2025, respectively.

In light of the Company’s determination that any repayment of the Amended and Restated Note would have been paid primarily from the cash distributions from Freedom VCM or foreclosure on the underlying Freedom VCM equity interest and other collateral provided by Mr.

Kahn and his spouse, the Company has determined that both VCM and Mr.

Kahn are related parties as of March 31, 2026 and December 31, 2025.

There was no interest income during the three months ended March 31, 2026 and 2025.

Kahn are related parties as of June 30, 2026 and December 31, 2025.

There was no interest income during the three and six months ended June 30, 2026 and 2025.

During the three months ended March 31, 2026, the Company collected $ 1,855 on the loan receivable from the sale of all of the collateral that the company held for the Vintage loan.

No additional collections are expected on the loan receivable.

Torticity, LLC

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There were amendments to the loan during 2025;

however, the entire loan receivable remains impaired with no fair value at March 31, 2026.

There was no interest income on the loan receivable during three months ended March 31, 2026 and all of 2025.

however, the entire loan receivable remains impaired with no fair value at June 30, 2026.

There was no interest income on the loan receivable during three and six months ended June 30, 2026 and all of 2025.

GA Holdings is a related party as a result of the Company’s equity investment as fully described in Note 10 - Equity Method Investments and BRC’s representation on the board of directors.

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The secured revolving credit facility was secured by all of the assets of GA Holdings and accrued interest at the annual rate of SOFR plus 4.75 %.

Interest income recorded on the loan receivable was $ 307 during the three months ended March 31, 2025.

Interest income recorded on the loan receivable was $ 394 and $ 701 during the three and six months ended June 30, 2025, respectively.

On October 16, 2025, all outstanding amounts due and owing under this facility were repaid in full to BRF and the facility was terminated.

During the period from November 15, 2024 to October 16, 2025, the Company provided services to GA Holdings in accordance with a transition services agreement for accounting, information technology and other administration services.

During the three months ended March 31, 2025, the Company recorded fee revenues for these services in the amount of $ 1,131 .

Pursuant to an existing consulting arrangement, as amended on December 31, 2025 to extend the term through December 31, 2026, the Company also paid $ 93 of consulting fees to the consultant, who was hired in July 2025 as the chief executive officer of GA Holdings, during the three months ended March 31, 2026.

During the three and six months ended June 30, 2025, the Company recorded fee revenues for these services in the amount

of $ 563 and $ 1,694 , respectively.

Pursuant to an existing consulting arrangement, as amended on December 31, 2025 to extend the term through December 31, 2026, the Company also paid $ 12 and $ 105 respectively, of consulting fees to the consultant, who was hired in July 2025 as the chief executive officer of GA Holdings, during the three and six months ended June 30, 2026.

GA Joann Retail Partnership, LLC

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This loan receivable was paid in full on April 7, 2025.

Interest income recorded on the loan receivable was $ 214 during the three months ended March 31, 2025.

Interest income recorded on the loan receivable was $ 9 and $ 223 during the three and six months ended June 30, 2025, respectively.

The Company often provides consulting or investment banking services to raise capital for companies in which the Company has significant influence through equity ownership, representation on the board of directors (or similar governing body), or both.

During the three months ended March 31, 2026 and 2025, the Company earned zero and $ 657 of fees related to these services, respectively.

During the three months ended June 30, 2026 and 2025, the Company earned $ 400 and $ 1,964 of fees related to these services, respectively.

During the six months ended June 30, 2026 and 2025, the Company earned $ 400 and $ 2,621 of fees related to these services, respectively.

The Company established BRC Trust on January 6, 2025, for the purpose of transferring and liquidating the assets of BRCPOF.

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The following is a summary of certain financial data for each of the Company’s reportable segments:

Three Months Ended March 31, 2026 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Three Months Ended June 30, 2026 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Revenues - Services and fees (2)

$ 45,939 $ 48,702 $ 38,788 $ 8,281 $ 6,878 $ 2,881 $ — $ 151,469 $ 22,126 $ 173,595

Trading gains (losses), net 4,363 9,251 — — — — — 13,614 ( 740 ) 12,874

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Other selling, general and administrative expenses (3)

( 7,593 ) ( 4,555 ) ( 4,357 ) ( 292 ) ( 365 ) ( 98 ) ( 1,056 ) ( 18,316 ) 2,302 ( 16,014 )

Restructuring charge ( 1,757 ) ( 29 ) — — — — ( 128 ) ( 1,914 ) — ( 1,914 )

Impairment of tradename — — — — — — ( 4,000 ) ( 4,000 ) — ( 4,000 )

Interest expense - Securities lending and loan participations sold ( 906 ) — — — — — — ( 906 ) — ( 906 )

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Corporate and All Other consists of general corporate administrative functions not allocable to reportable segments and operating segments and entities that individually, or in aggregate, do not meet the criteria of a separate reportable segment including bebe, and individual investment and lending entities.

Three Months Ended March 31, 2025 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Revenues - Services and fees for the Corporate and All Other category includes intersegment eliminations.

Other selling, general and administrative expenses for the Corporate and All Other category includes intersegment eliminations and corporate expense allocations to segments.

Three Months Ended June 30, 2025 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Revenues - Services and fees (2)

Trading (losses) gains, net ( 17,266 ) 612 — — — — — ( 16,654 ) 483 ( 16,171 )

$ 37,919 $ 33,421 $ 39,907 $ 9,473 $ 8,065 $ 3,287 $ — $ 132,072 $ 13,700 $ 145,772

Trading gains, net 21,249 5,200 — — — — — 26,449 1,231 27,680

Fair value adjustment on loans — — — — — — — — 800 800

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Other selling, general and administrative expenses (3)

( 9,919 ) ( 4,935 ) ( 4,904 ) ( 165 ) ( 343 ) ( 94 ) ( 1,228 ) ( 21,588 ) 2,938 ( 18,650 )

Restructuring charge — — — — — — ( 36 ) ( 36 ) ( 285 ) ( 321 )

Impairment of tradename — — — — — — ( 1,500 ) ( 1,500 ) — ( 1,500 )

Interest expense - Securities lending and loan participations sold ( 1,655 ) — — — — — — ( 1,655 ) ( 313 ) ( 1,968 )

Segment income (loss) $ 17,220 $ ( 1,319 ) $ 2,927 $ 5,090 $ 1,805 $ 1,550 $ ( 5,904 ) $ 21,369 $ ( 10,554 ) $ 10,815

Revenues - Services and fees for the Corporate and All Other category includes intersegment eliminations.

Other selling, general and administrative expenses for the Corporate and All Other category includes intersegment eliminations and corporate expense allocations to segments.

Six Months Ended June 30, 2026 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Revenues - Services and fees (2)

$ 81,489 $ 90,781 $ 79,578 $ 16,754 $ 13,904 $ 5,702 $ — $ 288,208 $ 37,509 $ 325,717

Trading gains (losses), net 139,666 19,347 — — — — — 159,013 ( 1,078 ) 157,935

Fair value adjustment on loans 751 — — — — — — 751 10,039 10,790

Interest income - loans 1,034 — — — — — — 1,034 2,851 3,885

Interest income - securities lending 2,883 — — — — — — 2,883 — 2,883

Revenues - Sale of goods — — — 596 1,001 — 87,652 89,249 718 89,967

Total revenues 225,823 110,128 79,578 17,350 14,905 5,702 87,652 541,138 50,039 591,177

Direct cost of services — — ( 44,969 ) ( 3,405 ) ( 4,428 ) ( 1,779 ) — ( 54,581 ) ( 6,485 ) ( 61,066 )

Cost of goods sold — — — ( 556 ) ( 1,026 ) — ( 61,460 ) ( 63,042 ) ( 684 ) ( 63,726 )

Employee compensation and benefits ( 54,373 ) ( 64,453 ) ( 8,591 ) ( 1,367 ) ( 679 ) ( 331 ) ( 18,911 ) ( 148,705 ) ( 27,049 ) ( 175,754 )

Professional services ( 896 ) ( 511 ) ( 55 ) ( 626 ) ( 151 ) ( 72 ) ( 2,895 ) ( 5,206 ) ( 23,217 ) ( 28,423 )

Occupancy-related costs ( 3,231 ) ( 4,117 ) ( 1,243 ) ( 697 ) ( 931 ) ( 309 ) ( 2,761 ) ( 13,289 ) ( 6,475 ) ( 19,764 )

Depreciation and amortization ( 474 ) ( 769 ) ( 6,431 ) ( 1,693 ) ( 939 ) ( 44 ) ( 3,357 ) ( 13,707 ) ( 1,430 ) ( 15,137 )

Other selling, general and administrative expenses (3)

( 13,116 ) ( 6,747 ) ( 9,206 ) ( 582 ) ( 677 ) ( 205 ) ( 2,473 ) ( 33,006 ) 4,359 ( 28,647 )

Restructuring charge ( 1,757 ) ( 29 ) — — — — ( 128 ) ( 1,914 ) — ( 1,914 )

Impairment of tradename — — — — — — ( 4,000 ) ( 4,000 ) — ( 4,000 )

Interest expense - Securities lending and loan participations sold ( 1,623 ) — — — — — — ( 1,623 ) — ( 1,623 )

Segment income (loss) $ 150,353 $ 33,502 $ 9,083 $ 8,424 $ 6,074 $ 2,962 $ ( 8,333 ) $ 202,065 $ ( 10,942 ) $ 191,123

Revenues - Services and fees for the Corporate and All Other category includes intersegment eliminations.

Other selling, general and administrative expenses for the Corporate and All Other category includes intersegment eliminations and corporate expense allocations to segments.

Six Months Ended June 30, 2025 Capital Markets Wealth Management Lingo magicJack Marconi Wireless UOL Consumer Products Total Reportable Segments Corporate & All Other (1)

Revenues - Services and fees (2)

$ 59,511 $ 80,087 $ 81,460 $ 18,919 $ 16,606 $ 6,920 $ — $ 263,503 $ 41,108 $ 304,611

Trading gains, net 3,983 5,812 — — — — — 9,795 1,714 11,509

Fair value adjustment on loans ( 3,131 ) — — — — — — ( 3,131 ) ( 4,165 ) ( 7,296 )

Interest income - loans 65 — — — — — — 65 6,984 7,049

Interest income - securities lending 2,964 — — — — — — 2,964 — 2,964

Revenues - Sale of goods — — — 659 2,113 — 85,387 88,159 4,369 92,528

Total revenues 63,392 85,899 81,460 19,578 18,719 6,920 85,387 361,355 50,010 411,365

Direct cost of services — — ( 48,121 ) ( 3,858 ) ( 8,034 ) ( 2,185 ) — ( 62,198 ) ( 13,718 ) ( 75,916 )

Cost of goods sold — — — ( 650 ) ( 2,584 ) — ( 64,660 ) ( 67,894 ) ( 3,952 ) ( 71,846 )

Employee compensation and benefits ( 50,963 ) ( 63,169 ) ( 9,656 ) ( 1,506 ) ( 1,502 ) ( 603 ) ( 19,061 ) ( 146,460 ) ( 34,665 ) ( 181,125 )

Professional services ( 1,491 ) ( 991 ) ( 343 ) ( 794 ) ( 178 ) ( 40 ) ( 1,975 ) ( 5,812 ) ( 24,066 ) ( 29,878 )

Occupancy-related costs ( 3,675 ) ( 7,995 ) ( 1,615 ) ( 756 ) ( 1,246 ) ( 353 ) ( 2,933 ) ( 18,573 ) ( 8,029 ) ( 26,602 )

Depreciation and amortization ( 1,361 ) ( 1,417 ) ( 6,646 ) ( 1,758 ) ( 966 ) ( 136 ) ( 3,864 ) ( 16,148 ) ( 2,498 ) ( 18,646 )

Other selling, general and administrative expenses (3)

( 22,276 ) ( 11,922 ) ( 9,753 ) ( 550 ) ( 660 ) ( 199 ) ( 2,403 ) ( 47,763 ) ( 5,743 ) ( 53,506 )

Restructuring charge — — — — — — ( 36 ) ( 36 ) ( 285 ) ( 321 )

Impairment of tradename — — — — — — ( 1,500 ) ( 1,500 ) — ( 1,500 )

Interest expense - Securities lending and loan participations sold ( 2,149 ) — — — — — — ( 2,149 ) ( 538 ) ( 2,687 )

Segment (loss) income $ ( 18,523 ) $ 405 $ 5,326 $ 9,706 $ 3,549 $ 3,404 $ ( 11,045 ) $ ( 7,178 ) $ ( 43,484 ) $ ( 50,662 )

Reconciliation of Segment Income (Loss) to Net Income (Loss):

Revenues - Services and fees for the Corporate and All Other category includes intersegment eliminations.

Other selling, general and administrative expenses for the Corporate and All Other category includes intersegment eliminations and corporate expense allocations to segments.

Reconciliation of Segment Income (Loss) to Net Income:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Segment income (loss) $ 38,195 10,815 $ 191,123 $ ( 50,662 )

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Gain on senior note exchange — 44,454 — 54,986

Income (loss) from equity investments 1,326 ( 552 )

Gain (loss) on extinguishment of debt 2,890 ( 10,427 )

(Loss) income from equity investments ( 5,459 ) 25,603 ( 4,133 ) 25,051

(Loss) gain on extinguishment of debt ( 1,283 ) ( 10,266 ) 1,607 ( 20,693 )

Interest expense:

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Interest expense ( 18,016 ) ( 23,952 ) ( 37,810 ) ( 53,916 )

Income (loss) from continuing operations before income taxes 239,050 ( 23,004 )

(Provision for) benefit from income taxes ( 16,891 ) 3,042

Income (loss) from continuing operations 222,159 ( 19,962 )

Income from continuing operations before income taxes 27,547 74,740 266,597 51,736

Provision for income taxes ( 5,950 ) ( 3,053 ) ( 22,841 ) ( 11 )

Income from continuing operations 21,597 71,687 243,756 51,725

Income from discontinued operations, net of income taxes — 69,312 — 72,707

Net income (loss) 222,159 ( 16,567 )

Net income 21,597 140,999 243,756 124,432

Net income (loss) attributable to noncontrolling interests 1,048 1,528 9,934 ( 5,064 )

Net income (loss) attributable to BRC Group Holdings, Inc.

Net income attributable to BRC Group Holdings, Inc.

20,549 139,471 233,822 129,496

Preferred stock dividends 2,015 2,015 4,030 4,030

Net income (loss) available to common shareholders $ 211,258 $ ( 11,990 )

Net income available to common shareholders $ 18,534 $ 137,456 $ 229,792 $ 125,466

The following table presents revenues by geographical area:

Three Months Ended

Six Months Ended

2026 2025 2026 2025

Services and fees

North America $ 173,595 $ 145,772 $ 325,717 $ 304,611

Trading gains (losses), net

Trading gains, net

North America 12,874 27,680 157,935 11,509

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The following table presents long-lived assets, which consists of property and equipment, net, by geographical area:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Long-lived Assets - Property and Equipment, net:

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Claims include breach of fiduciary duties and unjust enrichment.

The parties have agreed to stay this action pending decisions in the other derivative matters, and a stipulation to that effect has been accepted by the court.

The Company believes that these claims are meritless and intends to defend this action.

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Claims include breach of fiduciary duties, waste of corporate assets, and unjust enrichment.

The parties have agreed to stay this action pending decisions in the other derivative matters, and a stipulation to that effect has been submitted to the court.

The Company believes that these claims are meritless and intends to defend this action.

On July 11, 2025, the Company’s subsidiary, BRS, received a demand letter from certain parties that invested in a special purpose entity (the “SPV”) that in turn invested in the going private transaction (the “Transaction”) in August 2023 of Franchise Group, Inc.

On July 11, 2025, the Company’s subsidiary, BRS, received a demand letter from certain parties that invested in a special purpose entity that in turn invested in the going private transaction (the “Transaction”) in August 2023 of Franchise Group, Inc.

An arbitration demand (the “Demand”) was filed by such parties with the American Arbitration Association on October 10, 2025 against BRS and related entities (the “BR Defendants”).

The Demand alleges that the BR Defendants (i) failed to disclose certain material facts regarding FRG and the Transaction in violation of certain securities laws, (ii) committed fraud and/or civil conspiracy, and (iii) breached fiduciary duties and aided and abetted the breach of fiduciary duties.

Such investors seek rescission of the aggregate investment amount of $ 37,500 plus interest thereon and related fees and expenses.

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The Company believes that these claims are meritless and intends to defend this action.

On July 19, 2024, the Company received a demand from two stockholders, Renato Rene Amio and Stephen Edwards, to inspect certain of the Company’s books and records pursuant to Section 220 of the Delaware General Corporation Law, focused on the Company’s business dealings with Mr.

Kahn and the FRG take-private transaction, and the Company produced documents in response.

On January 16, 2026, the same stockholders delivered a pre-suit litigation demand to the Company’s Board of Directors demanding that the Board pursue claims against certain officers and directors for alleged breaches of fiduciary duty, citing Mr.

Kahn’s December 2025 guilty plea, alleging that the Board knew or should have known of Mr.

Kahn’s history, criticizing the Company’s internal investigations, and seeking disgorgement of compensation, personnel action, and corporate governance reforms.

The demand does not specify an amount of alleged damages.

The Company believes any resulting claims would be without merit and intends to respond in due course.

On July 9, 2024, a putative class action was filed by Brian Gale, Mark Noble, Terry Philippas and Lawrence Bass in the Delaware Chancery Court against Freedom VCM, Mr.

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Riley’s personal loan and his pledge of shares of the Company’s common stock as collateral for such loan.

In June 2026, the SEC issued subpoenas to certain current and former employees seeking their testimony.

As previously disclosed on April 23, 2024, the Audit Committee of the Company’s Board of Directors, with the assistance of Sullivan & Cromwell LLP, the Company’s legal counsel, conducted an internal review, and separately the Audit Committee retained Winston & Strawn LLP, independent legal counsel, to conduct an independent investigation, to review transactions among Mr.

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An amended complaint was filed on September 27, 2024.

The amended complaint alleges that the offering documents failed to advise investors that Brian Kahn and/or one or more of his controlled entities was engaged in illicit business activities, that the Company, despite the foregoing, continued to finance transactions for Kahn, eventually enabling him and others to take FRG private, and that the foregoing was reasonably likely to draw regulatory scrutiny and reputational harm to the Company.

The amended complaint alleges that the offering documents failed to advise investors that Brian Kahn and/or one or more

of his controlled entities was engaged in illicit business activities, that the Company, despite the foregoing, continued to finance transactions for Kahn, eventually enabling him and others to take FRG private, and that the foregoing was reasonably likely to draw regulatory scrutiny and reputational harm to the Company.

The Company believes these claims are meritless and intends to defend this action.

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The amended complaint alleges that the Company failed to disclose to investors material financial details concerning a going private transaction involving FRG, and that the Company made false or misleading statements concerning the Company’s lending practices, its high concentration of risk in transactions involving Mr.

Kahn and his affiliates, the condition and composition of the Company’s loan portfolio, the Company’s due

diligence and risk management procedures, and the Company’s level of concern and internal scrutiny concerning Mr.

Kahn and his affiliates, the condition and composition of the Company’s loan portfolio, the Company’s due diligence and risk management procedures, and the Company’s level of concern and internal scrutiny concerning Mr.

Kahn after it learned he was potentially implicated in a fraud involving an unrelated third party.

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On September 12, 2025, the Court denied BRCC’s motion to dismiss.

The Company believes that the liquidating trustee’s claims lack merit and intends to continue to assert its statutory defenses to defeat such claims.

The Company believes that the Trustee’s claims lack merit and intends to continue to assert its statutory defenses to defeat such claims.

In light of the significant factual issues to be resolved with respect to the asserted claims and other proceedings described above and uncertainties regarding unasserted claims described above, at the present time reasonably possible losses cannot be estimated with respect to the asserted and unasserted claims described in the preceding paragraphs.

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Pursuant to this indemnity agreement, the Company agreed to indemnify the surety in connection with a default by B&W under a € 30,000 payment and performance bond issued by the surety in connection with a construction project undertaken by B&W.

Under the agreement, the performance bond amount was reduced upon the satisfaction of specified contractual performance obligations.

As of March 31, 2026, the Company’s indemnity obligation under the performance bond was € 5,000 .

Under the agreement, the performance bond amount was reduced upon the satisfaction of specified

contractual performance obligations.

As of June 30, 2026, the Company’s indemnity obligation under the performance bond was € 5,000 .

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Securities underwriting exposes the Company to 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 entered into two Written Put agreements in April and September of 2025 under which the Issuers may require the Company to purchase up to:

(i) $ 15,000 of the Issuer’s convertible preferred stock prior to March 24, 2027 and (ii) $ 1,000,000 of the Issuer’s convertible preferred stock prior to September 11, 2028, subject to limitations.

The Company entered into two Written Put agreements in April and September of 2025 and the September 2025 Written Put agreement has been subsequently amended.

Under the Written Put agreements, the Issuers may require the Company to purchase up to:

(i) $ 15,000 of the Issuer’s convertible preferred stock prior to March 24, 2027 and (ii) $ 2,000,000 of the Issuer’s convertible preferred stock prior to August 27, 2029, subject to limitations.

The maximum put notice is (i) $ 500 per week in the aggregate and (ii) $ 150,000 per issuance and no more than one put notice a week, respectively.

Conversion of the preferred stock is subject to a 19.99 % conversion limitation pursuant to the applicable Nasdaq Listing Rules (the “Exchange Cap”).

Conversion of the preferred stock is subject to a 19.99 % conversion limitation pursuant to the applicable Nasdaq Listing Rules.

If exercised, the Company would remit 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.

During the three months ended March 31, 2026, the Company purchased an aggregate of $ 150,000 of preferred shares pursuant to the April 2025 agreement.

As of March 31, 2026, (i) $ 12,700 and (ii) $ 775,000 remained outstanding and had not been exercised by the Issuer, and no amounts were due (see Note 5 - Fair Value Measurements).

NOTE 27 — SUBSEQUENT EVENTS

On April 30, 2026 and May 1, 2026, the Company completed exchanges in accordance with Section 3(a)(9) of the Securities Act of 1933 (the “Subsequent Exchanges”) with the Investor whereby the Company exchanged an aggregate principal amount of approximately $ 13,463 of senior notes which included (i) approximately $ 11,463 of the 6.50 % Senior Notes due September 30, 2026 and (ii) $ 2,000 of the 5.00 % Senior Notes due December 31, 2026, for an aggregate of 1,743,946 shares of the Company’s common stock.

Such senior notes were then cancelled following the Subsequent Exchanges.

The Investor owns more than five percent of the Company’s common stock.

As a result, a “Preferred Dividend Default” has occurred under each Certificate of Designation.

The election of Preferred Directors will take place at (i) either (A) a special meeting called in accordance with the Certificate of Designation requirements if the request is received more than 90 days before the date fixed for the Corporation’s next annual or special meeting of stockholders or (B) the next annual or special meeting of stockholders if the request is received within 90 days of the date fixed for the Corporation’s next annual or special meeting of stockholders, and (ii) at each subsequent annual meeting of stockholders, or special meeting at which Preferred Directors are to be elected, until the right of holders of Series A Preferred Stock and Series B Preferred Stock to elect Preferred Directors shall have terminated.

As of the date of this Quarterly Report, the Company has not received a written demand from holders of the Series A Preferred Stock or Series B Preferred Stock to call a special meeting for the election of Preferred Directors.

During the three and six months ended June 30, 2026, the Company purchased an aggregate of $ 225,000 and $ 375,000 of preferred shares pursuant to the April 2025 agreement.

As of June 30, 2026, future commitments for the Written Puts include:

(i) $ 12,700 , which does not meet the requirements to be put by one Issuer, due to a decrease in stock price below the required floor as of the balance sheet date and (ii) $ 960,000 , which remained outstanding from another Issuer and had not been exercised, and no amounts were due (see Note 5 - Fair Value Measurements).

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements