What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-07-29 compared with 2022-04-29 · 312 added, 133 removed, 277 unchanged (62% of the section changed)

35 unchanged sentences

the failure of our brand investment portfolio licensees to pay us royalties;

and the intense competition to which our brand investment portfolio is subject.

the intense competition to which our brand investment portfolio is subject;

and the effect of geopolitical instability, including wars, conflicts and terrorist attacks, including the impacts of Russia’s invasion of Ukraine.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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Riley Securities, a leading, full service investment bank that provides corporate finance, lending, research, securities lending and sales and trading services to corporate, institutional, and high net worth individual clients.

It is nationally recognized for its proprietary small and mid-cap equity research.

is nationally recognized for its proprietary small and mid-cap equity research.

Riley Securities was established from the merger of B.

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(“UOL” or “United Online”), which was acquired in July 2016, magicJack VocalTec Ltd.

(“magicJack”), which was acquired in November 2018, a 40% equity interest in Lingo Management, LLC (“Lingo”), which was acquired in November 2020, and a mobile virtual network operator business (“Marconi Wireless”), which was acquired in October 2021.

Upon receipt of certain regulatory approvals, the Company has the right to acquire an additional 40% equity interest in Lingo.

(“magicJack”), which was acquired in November 2018, Lingo Management, LLC (“Lingo”) in which the Company increased its ownership interest from 40% to 80% in May 2022, and a mobile virtual network operator business (“Marconi Wireless”), which was acquired in October 2021.

The following briefly describes each such business:

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◦ magicJack is a Voice over IP (“VoIP”) cloud-based technology and services and wireless mobile communications provider.

◦ Lingo is a global cloud/UC and managed service provider.

◦ Lingo is a global cloud/unified communications (“UC”) and managed service provider.

◦ Marconi Wireless is a mobile virtual network operator business that provides mobile phone voice, text, and data services and devices.

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Our Capital Markets segment also includes our asset management businesses that manage various private and public funds for institutional and individual investors.

This segment also includes the results of operations of FocalPoint Securities, LLC ("FocalPoint") from the date of acquisition on January 19, 2022.

Wealth Management Segment .

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Currently, this segment includes, among other investments, UOL, through which we provide consumer Internet access, magicJack, through which we provide VoIP communication and related product and subscription services, and Marconi Wireless, through which we provide mobile phone services and devices.

This segment also includes the results of operations of Lingo from the date of acquisition on May 31, 2022.

Brands Segment.

1 unchanged sentence

Recent Developments

On January 19, 2022, we acquired FocalPoint Securities, LLC ("FocalPoint"), an independent investment bank headquartered in Los Angeles, California.

On May 31, 2022, our ownership interest in Lingo increased from 40% to 80% as a result of the conversion of $17.5 million of existing debt owed by Lingo to equity.

As a result of the consolidation of Lingo, the pre-existing equity investment was remeasured at fair value resulting in the recognition of a gain of $6.8 million, which is included in trading (losses) income and fair value adjustments on loans in the condensed consolidated statement of operations for the three and six months ended June 30, 2022.

In accordance with ASC 805, we used the acquisition method of accounting.

The total fair value of the assets of Lingo was $115.8 million and the fair value of the 20% noncontrolling interest was $8.0 million at May 31, 2022.

Goodwill of $32.0 million and other intangible assets of $65.2 million were recorded as a result of the

The acquisition is expected to expand the services offered in our Principal Investments - Communications and Other segment.

On January 19, 2022, we acquired FocalPoint, an independent investment bank headquartered in Los Angeles, California.

The purchase price consideration totaled $124.5 million, which consisted of $64.2 million in cash, $20.3 million in issuance of our common stock, and $39.9 million in deferred cash and contingent consideration payable over the next three years.

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however, the full impact of the COVID-19 outbreak continues to evolve with the emergence of new variant strains and breakthrough infections.

Although the U.S.

economy continued to grow during the first quarter of 2022, the

continuing impact of the COVID-19 pandemic, higher inflation, the actions by the Federal Reserve to address inflation, and rising energy prices create uncertainty about the future economic environment which will continue to evolve and may impact our business in future periods.

The continuing impact of the COVID-19 pandemic, higher inflation, the actions by the Federal Reserve to address inflation, Russia's invasion of Ukraine, and rising energy prices create uncertainty about the future economic environment which will continue to evolve and may impact our business in future periods.

These developments and the impact on the financial markets and the overall economy continue to be highly uncertain and cannot be predicted.

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The following period to period comparisons of our financial results and our interim results are not necessarily indicative of future results.

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Condensed Consolidated Statements of Operations

(Dollars in thousands)

Three Months Ended March 31, Change

Three Months Ended June 30, Change

2022 2021 Amount %

Services and fees $ 200,905 $ 266,143 $ (65,238) (24.5) %

Trading (losses) income and fair value adjustments on loans (223,927) 32,679 (256,606) n/m

Interest income - Loans and securities lending 63,835 25,491 38,344 150.4 %

Sale of goods 1,887 12,457 (10,570) (84.9) %

Total revenues 42,700 336,770 (294,070) (87.3) %

Operating expenses:

Direct cost of services 17,785 12,094 5,691 47.1 %

Cost of goods sold 1,994 3,626 (1,632) (45.0) %

Selling, general and administrative expenses 167,136 199,922 (32,786) (16.4) %

Interest expense - Securities lending and loan participations sold 14,544 10,983 3,561 32.4 %

Total operating expenses 201,459 226,625 (25,166) (11.1) %

Operating (loss) income (158,759) 110,145 (268,904) n/m

Other income (expense):

Interest income 500 56 444 n/m

Change in fair value of financial instruments and other 4,321 6,509 (2,188) (33.6) %

Loss from equity investments (3,399) (852) (2,547) n/m

Interest expense (31,764) (20,856) (10,908) 52.3 %

(Loss) income before income taxes (189,101) 95,002 (284,103) n/m

Benefit from (provision for) income taxes 52,513 (19,902) 72,415 n/m

Net (loss) income (136,588) 75,100 (211,688) n/m

Net income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests 3,571 (576) 4,147 n/m

Net (loss) income attributable to B.

Riley Financial, Inc.

(140,159) 75,676 (215,835) n/m

Preferred stock dividends 2,002 1,789 213 11.9 %

Net (loss) income available to common shareholders $ (142,161) $ 73,887 $ (216,048) n/m

n/m - Not applicable or not meaningful.

The table below and the discussion that follows are based on how we analyze our business.

Three Months Ended June 30, Change

2022 2021 Amount %

Revenues - Services and fees:

Capital Markets segment $ 67,426 $ 125,997 $ (58,571) (46.5) %

Wealth Management segment 60,861 87,444 (26,583) (30.4) %

Auction and Liquidation segment 2,488 5,534 (3,046) (55.0) %

Financial Consulting segment 24,310 23,735 575 2.4 %

Principal Investments - Communications and Other segment 40,646 18,932 21,714 114.7 %

Brands segment 5,174 4,501 673 15.0 %

Subtotal 200,905 266,143 (65,238) (24.5) %

Revenues - Sale of goods:

Auction and Liquidation segment — 11,743 (11,743) (100.0) %

Principal Investments - Communications and Other segment 1,887 714 1,173 164.3 %

Subtotal 1,887 12,457 (10,570) (84.9) %

Trading (losses) income and fair value adjustments on loans

Capital Markets segment (225,455) 29,897 (255,352) n/m

Wealth Management segment 1,528 2,865 (1,337) (46.7) %

Brands segment — (83) 83 (100.0) %

Subtotal (223,927) 32,679 (256,606) n/m

Interest income - Loans and securities lending:

Capital Markets segment 62,399 25,491 36,908 144.8 %

Auction and Liquidation segment 1,436 — 1,436 100.0 %

Subtotal 63,835 $ 25,491 38,344 150.4 %

Total revenues $ 42,700 $ 336,770 $ (294,070) (87.3) %

_______________________________________________

n/m - Not applicable or not meaningful.

Total revenues decreased approximately $294.1 million to $42.7 million during the three months ended June 30, 2022 from $336.8 million during the three months ended June 30, 2021.

The decrease in revenues during the three months ended June 30, 2022 was primarily due to decreases in the fair value of the portfolio of securities and other investments owned and fair value adjustments on loans of $256.6 million, which is included in trading (losses) income and fair value adjustments on loans above, services and fees of $65.2 million and sale of goods of $10.6 million, partially offset by an increase in interest income from loans and securities lending of $38.3 million.

The decrease in the fair value of the portfolio of securities and other investments owned as of June 30, 2022 was primarily due to the decrease in overall values in the stock market.

The decrease in revenue from services and fees in the three months ended June 30, 2022 consisted of decreases in revenue of $58.6 million in the Capital Markets segment, $26.6 million in the Wealth Management segment and $3.0 million in the Auction and Liquidation segment, partially offset by increases in revenues of $21.7 million in the Principal Investments — Communications and Other segment, $0.7 million in the Brands segment, and $0.6 million in the Financial Consulting segment.

Revenues from services and fees in the Capital Markets segment decreased $58.6 million to $67.4 million during the three months ended June 30, 2022 from $126.0 million during the three months ended June 30, 2021.

The decrease in revenues was primarily due to decreases in revenue of $71.8 million from corporate finance, consulting, and investment banking fees, partially offset by increases of $7.7 million in dividends, $2.9 million in other income, and $1.9 million in interest income.

Revenues from services and fees in the Wealth Management segment decreased $26.6 million to $60.9 million during the three months ended June 30, 2022 from $87.4 million during the three months ended June 30, 2021.

The decrease in revenues was primarily due to decreases in revenue of $14.8 million in commission fees and $13.7 million in wealth and asset management fees, partially offset by an increase of $2.0 million in other income.

Revenues from services and fees in the Auction and Liquidation segment decreased $3.0 million to $2.5 million during the three months ended June 30, 2022 from $5.5 million during the three months ended June 30, 2021.

The decrease in revenues was primarily due to fewer large retail fee liquidation engagements.

Revenues from services and fees in the Financial Consulting segment increased $0.6 million to $24.3 million during the three months ended June 30, 2022 from $23.7 million during three months ended June 30, 2021.

Revenues from services and fees in the Principal Investments - Communications and Other segment increased $21.7 million to $40.6 million during the three months ended June 30, 2022 from $18.9 million during the three months ended June 30, 2021.

The increase in revenues was primarily due to an increase in subscription services of $12.4 million from the acquisition of Marconi Wireless in the fourth quarter of 2021 and $10.7 million from the acquisition of an additional equity interest in Lingo in the second quarter of 2022 and an increase in advertising licensing and other revenue of $1.2 million, partially offset by a decrease of $2.5 million in subscription services for UOL and magicJack.

We expect the UOL and magicJack subscription revenues to continue to decline year over year.

Revenues from services and fees in the Brands segment increased $0.7 million to $5.2 million during the three months ended June 30, 2022 from $4.5 million during the three months ended June 30, 2021.

The primary source of revenue included in this segment is the licensing of trademarks.

Trading (losses) income and fair value adjustments on loans decreased $256.6 million to a loss of $223.9 million during the three months ended June 30, 2022 compared to income of $32.7 million during the three months ended June 30, 2021.

This decrease was primarily due to decreases of $255.4 million in the Capital Markets segment and $1.3 million in the Wealth Management segment.

The loss of $223.9 million during the three months ended June 30, 2022 was primarily due to realized and unrealized losses on investments made in our proprietary trading accounts of $219.8 million and unrealized loss on our loans receivable, at fair value of $11.0 million, partially offset by a realized gain on disposal of an equity method investment of $6.8 million.

Interest income – loans and securities lending increased $38.3 million to $63.8 million during the three months ended June 30, 2022 from $25.5 million during the three months ended June 30, 2021.

Interest income from securities lending was $18.7 million and $13.9 million during the three months ended June 30, 2022 and 2021, respectively.

Interest income from loans was $45.1 million and $11.6 million during the three months ended June 30, 2022 and 2021, respectively.

Revenues – Sale of Goods

Revenues from the sale of goods decreased $10.6 million to $1.9 million during the three months ended June 30, 2022 from $12.5 million during three months ended June 30, 2021.

Revenues from sale of goods were attributable to a decrease of $11.7 million from sales of retail goods related to retail liquidation engagements in Europe that ended, partially offset by an increase of $1.4 million from sales of retail goods due to the acquisition of Marconi Wireless in the fourth quarter of 2021.

Cost of goods sold for three months ended June 30, 2022 was $2.0 million, resulting in a negative gross margin of 5.7%.

Operating Expenses

Direct Cost of Services

Direct cost of services increased $5.7 million to $17.8 million during the three months ended June 30, 2022 from $12.1 million during the three months ended June 30, 2021.

The activity is primarily driven by an increase of $11.9 million from

the Principal Investments — Communications and Other segment, partially offset by a decrease of $6.2 million from the Auction and Liquidation segment.

The increase in the Principal Investments — Communications and Other segment was primarily due to increases of $7.5 million from the acquisition of Lingo in the second quarter of 2022 and $5.2 million from the acquisition Marconi Wireless in the fourth quarter of 2021.

The decrease in the Auction and Liquidation segment was primarily due to retail liquidation engagements in Europe that ended.

Selling, General and Administrative Expenses

Selling, general and administrative expenses during the three months ended June 30, 2022 and 2021 were comprised of the following:

Three Months Ended June 30, 2022 Three Months Ended

June 30, 2021 Change

Amount % Amount % Amount %

Capital Markets segment $ 48,069 28.7 % $ 65,720 33.0 % $ (17,651) (26.9) %

Wealth Management segment 69,702 41.8 % 91,042 45.5 % (21,340) (23.4) %

Auction and Liquidation segment 2,177 1.3 % 3,077 1.5 % (900) (29.2) %

Financial Consulting segment 20,026 12.0 % 19,560 9.8 % 466 2.4 %

Principal Investments -Communications and Other segment 16,403 9.8 % 7,296 3.6 % 9,107 124.8 %

Brands segment 1,401 0.8 % 1,405 0.7 % (4) (0.3) %

Corporate and Other segment 9,358 5.6 % 11,822 5.9 % (2,464) (20.8) %

Total selling, general & administrative expenses $ 167,136 100.0 % $ 199,922 100.0 % $ (32,786) (16.4) %

____________________________________

n/m - Not applicable or not meaningful.

Total selling, general and administrative expenses decreased approximately $32.8 million to $167.1 million during the three months ended June 30, 2022 from $199.9 million during the three months ended June 30, 2021.

The decrease was primarily due to decreases of $21.3 million in the Wealth Management segment, $17.7 million in the Capital Markets segment, $2.5 million in the Corporate and Other segment, and $0.9 million in the Auction and Liquidation segment partially offset by increases of $9.1 million in the Principal Investments — Communications and Other segment and $0.5 million in the Financial Consulting segment.

Capital Markets

Selling, general and administrative expenses in the Capital Markets segment decreased by $17.7 million to $48.1 million during the three months ended June 30, 2022 from $65.7 million during the three months ended June 30, 2021.

The decrease was primarily due to decreases of $14.8 million in consulting expenses and $12.1 million in payroll and related expenses investment banking deal expenses, partially offset by increases of $4.9 million from the settlement of a regulatory matter, $2.0 in depreciation and amortization expenses, $1.1 million gain from foreign currency exchange, and $1.1 million in business development expenses.

Wealth Management

Selling, general and administrative expenses in the Wealth Management segment decreased by $21.3 million to $69.7 million during the three months ended June 30, 2022 from $91.0 million during the three months ended June 30, 2021.

The decrease was primarily due to a decrease in payroll and related expenses of $27.8 million, partially offset by an increase of $4.9 million from the settlement of a regulatory matter.

Auction and Liquidation

Selling, general and administrative expenses in the Auction and Liquidation segment decreased $0.9 million to $2.2 million during the three months ended June 30, 2022 from $3.1 million during the three months ended June 30, 2021.

The decrease was primarily due to decreases of $0.4 million in business development expenses and $0.2 million in payroll and related expenses.

Financial Consulting

Selling, general and administrative expenses in the Financial Consulting segment increased by $0.5 million to $20.0 million during the three months ended June 30, 2022 from $19.6 million during the three months ended June 30, 2021.

Principal Investments — Communications and Other

Selling, general and administrative expenses in the Principal Investments — Communications and Other segment increased $9.1 million to $16.4 million for the three months ended June 30, 2022 from $7.3 million for the three months ended June 30, 2021.

The increase was primarily due to increases of $4.1 million from the acquisition of additional equity interest in Lingo in the second quarter of 2022, $1.6 million in transaction costs, $1.3 million in payroll and related expenses, $1.1 million in depreciation and amortization, $0.7 million in communications expenses, $0.2 million in software and equipment expenses, and $0.2 million business development expenses.

Selling, general and administrative expenses in the Brands segment remained flat at $1.4 million during the three months ended June 30, 2022 and 2021.

Corporate and Other

Selling, general and administrative expenses for the Corporate and Other segment decreased approximately $2.5 million to $9.4 million during the three months ended June 30, 2022 from $11.8 million during the three months ended June 30, 2021.

The decrease was primarily due to decreases of $4.5 million change in the fair value of contingent consideration, $2.2 million in loss from foreign currency exchange, partially offset by increases of $3.9 million in payroll and related expenses.

Other Income (Expense).

Other income included interest income of $0.5 million and $0.1 million during the three months ended June 30, 2022 and 2021, respectively.

Change in fair value of financial instruments and other in the amount of $4.3 million during the three months ended June 30, 2022 was primarily due to the change in fair value of warrant liabilities and the forgiveness of a Paycheck Protection Program loan issued to FocalPoint prior to its acquisition by the Company in the first quarter of 2022.

Interest expense was $31.8 million during the three months ended June 30, 2022 compared to $20.9 million during the three months ended June 30, 2021.

The increase in interest expense was primarily due to increases in interest expense of $5.0 million from the issuance of senior notes and $4.5 million and $1.2 million from the Nomura term loan and revolving credit facility, respectively, entered into during the second quarter of 2021.

During the three months ended June 30, 2022, loss from equity investments was $3.4 million compared to $0.9 million during the three months ended June 30, 2021.

The increase was primarily due to the $3.7 million loss recognized from the conversion of debt to equity in the acquisition of Lingo during the second quarter of 2022.

(Loss) Income Before Income Taxes .

Loss before income taxes was $189.1 million during the three months ended June 30, 2022 compared to income of $95.0 million during the three months ended June 30, 2021.

The change was primarily due to a decrease in revenue of $294.1 million, increase in interest expense of $10.9 million, increase in loss from equity investments of $2.5 million, and a decrease in change in fair value of financial instruments and other of $2.2 million, partially offset by a decrease in operating expenses of approximately $25.2 million and an increase in interest income of $0.4 million.

Benefit from (Provision for) Income Taxes.

Benefit from income taxes was $52.5 million during the three months ended June 30, 2022 compared to a provision of $19.9 million during the three months ended June 30, 2021.

The effective income tax rate was 27.8% for the three months ended June 30, 2022 as compared to 20.9% for the three months ended June 30, 2021.

Net Income (Loss) Attributable to Noncontrolling Interests and Redeemable Noncontrolling Interests .

Net income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests represents the proportionate share of net income generated by membership interests of partnerships that we do not own.

The net income attributable to

noncontrolling interests and redeemable noncontrolling interests was $3.6 million during the three months ended June 30, 2022 compared to a net loss of $0.6 million during the three months ended June 30, 2021.

Net (Loss) Income Attributable to the Company .

Net loss attributable to the Company was $140.2 million during the three months ended June 30, 2022 compared to net income attributable to the Company of $75.7 million during the three months ended June 30, 2021.

The change was primarily due to a change from operating income to loss of $268.9 million, increase in interest expense of $10.9 million, increase in net income attributable to noncontrolling interests and redeemable noncontrolling interests of $4.1 million, increase in loss from equity investments of $2.5 million, and a decrease in change in fair value of financial instruments and other of $2.2 million, partially offset by a change from provision for to benefit from income taxes of $72.4 million and an increase in interest income of $0.4 million.

Preferred Stock Dividends .

Holders of Series A Preferred Stock, when and as authorized by the board of directors of the Company, are entitled to cumulative cash dividends at the rate of 6.875% per annum of the $25,000 liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,718.75 or $1.71875 per Depositary Share).

Dividends are payable quarterly in arrears.

On January 10, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on January 31, 2022 to holders of record as of the close of business on January 21, 2022.

On April 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

Holders of Series B Preferred Stock, when and as authorized by the board of directors of the Company, are entitled to cumulative cash dividends at the rate of 7.375% per annum of the $25,000 liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,843.75 or $1.84375 per Depositary Share).

Dividends are payable quarterly in arrears.

On January 10, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on January 31, 2022 to holders of record as of the close of business on January 21, 2022.

On April 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

Net (Loss) Income Available to Common Shareholders .

Net loss available to common shareholders was $142.2 million during the three months ended June 30, 2022 compared to net income available to common shareholders of $73.9 million during the three months ended June 30, 2021.

The change was primarily due to a change from operating income to loss of $268.9 million, increase in interest expense of $10.9 million, increase in net income attributable to noncontrolling interests and redeemable noncontrolling interests of $4.1 million, increase in loss from equity investments of $2.5 million, decrease in change in fair value of financial instruments and other of $2.2 million, and an increase in preferred stock dividends of $0.2 million, partially offset by a change from provision for to benefit from income taxes of $72.4 million and an increase in interest income of $0.4 million.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Condensed Consolidated Statements of Operations

(Dollars in thousands)

Six Months Ended June 30, Change

2022 2021 Amount %

Services and fees $ 411,580 $ 555,612 $ (144,032) (25.9) %

Trading (losses) income and fair value adjustments on loans (292,317) 299,621 (591,938) (197.6) %

Interest income - Loans and securities lending 125,261 62,411 62,850 100.7 %

Sale of goods 3,765 19,285 (15,520) (80.5) %

6 unchanged sentences

Total operating expenses 402,326 453,806 (51,480) (11.3) %

Operating income 4,722 372,978 (368,256) (98.7) %

Operating (loss) income (154,037) 483,123 (637,160) (131.9) %

Other income (expense):

Interest income 67 49 18 36.7 %

Interest income 567 105 462 n/m

Change in fair value of financial instruments and other 10,302 6,509 3,793 58.3 %

Income from equity investments 6,775 875 5,900 674.3 %

Income from equity investments 3,376 23 3,353 n/m

Interest expense (62,200) (40,642) (21,558) 53.0 %

(Loss) income before income taxes (201,992) 449,118 (651,110) (145.0) %

Benefit (provision) for income taxes 3,695 (97,518) 101,213 (103.8) %

Benefit from (provision for) income taxes 56,208 (117,420) 173,628 (147.9) %

Net (loss) income $ (145,784) 331,698 (477,482) (144.0) %

Net income attributable to noncontrolling interests 866 1,942 (1,076) (55.4) %

Net income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests 4,437 1,366 3,071 n/m

Net (loss) income attributable to B.

5 unchanged sentences

The table below and the discussion that follows are based on how we analyze our business.

Three Months Ended March 31, Change

Six Months Ended June 30, Change

2022 2021 Amount %

12 unchanged sentences

Trading (losses) income and fair value adjustments on loans

Capital Markets segment (68,912) 264,503 (333,415) (126.1) %

Capital Markets segment (294,367) 294,400 (588,767) n/m

Wealth Management segment 2,050 5,221 (3,171) (60.7) %

Brands segment — 83 (83) (100.0) %

Subtotal (292,317) 299,621 (591,938) (197.6) %

1 unchanged sentence

Capital Markets segment 123,825 62,411 61,414 98.4 %

Auction and Liquidation segment 1,436 — 1,436 100.0 %

125,261 62,411 62,850 100.7 %

Total revenues $ 248,289 $ 936,929 $ (688,640) (73.5) %

1 unchanged sentence

n/m - Not applicable or not meaningful.

Total revenues decreased approximately $394.6 million to $205.6 million during the three months ended March 31, 2022 from $600.2 million during the three months ended March 31, 2021.

The decrease in revenues during the three months ended March 31, 2022 was primarily due to a decrease in revenue from trading (losses) income and fair value adjustments on loans of $335.3 million, services and fees of $78.8 million and sale of goods of $5.0 million, offset by an increase in revenue interest income from loans and securities lending of $24.5 million.

The decrease in revenue from services and fees in the three months ended March 31, 2022 consisted of decreases in revenue of $101.9 million in the Capital Markets segment and $4.0 million in the Auction and Liquidation segment, partially offset by increases in revenues of $11.4 million in the Wealth Management segment, $11.0 million in the Principal Investments — Communications and Other segment, $4.5 million in the Financial Consulting segment, $4.0 million in the Auction and Liquidation segment and $0.2 million in the Brands segment.

Revenues from services and fees in the Capital Markets segment decreased $101.9 million to $69.1 million during the three months ended March 31, 2022 from $171.0 million during the three months ended March 31, 2021.

The decrease in revenues was primarily due to decreases in revenue of $105.4 million from corporate finance, consulting, and investment banking fees and $3.5 million of commission fees, partially offset by an increase of $6.9 million in dividends.

Revenues from services and fees in the Wealth Management segment increased $11.4 million to $77.0 million during the three months ended March 31, 2022 from $65.5 million during the three months ended March 31, 2021.

The increase in revenues was primarily due to an increase in revenue of $13.7 million from wealth and asset management fees, partially offset by a decrease of $1.7 million in other income.

Revenues from services and fees in the Auction and Liquidation segment decreased $4.0 million to $3.4 million during the three months ended March 31, 2022 from $7.4 million during the three months ended March 31, 2021.

Total revenues decreased approximately $688.6 million to $248.3 million during the six months ended June 30, 2022 from $936.9 million during the six months ended June 30, 2021.

The decrease in revenues during the six months ended June 30, 2022 was primarily due to decreases in the fair value of the portfolio of securities and other investments owned and fair value adjustments on loans of $591.9 million, which is included in trading (losses) income and fair value adjustments on loans above, services and fees of $144.0 million, and sale of goods of $15.5 million, partially offset by an increase in interest income from loans and securities lending of $62.9 million.

The decrease in the fair value of the portfolio of securities and other investments owned as of June 30, 2022 was primarily due to the decrease in overall values in the stock market.

The decrease in revenue from services and fees in the six months ended June 30, 2022 consisted of decreases in revenue of $160.5 million in the Capital Markets segment, $15.2 million in the Wealth Management segment, and $7.0 million in the Auction and Liquidation segment, partially offset by increases in revenues of $32.7 million in the Principal Investments — Communications and Other segment, $5.1 million in the Financial Consulting segment, and $0.8 million in the Brands segment.

Revenues from services and fees in the Capital Markets segment decreased $160.5 million to $136.5 million during the six months ended June 30, 2022 from $297.0 million during the six months ended June 30, 2021.

The decrease in revenues was primarily due to decreases in revenue of $177.2 million from corporate finance, consulting, and investment banking fees and $3.4 million from commission fees, partially offset by increases of $14.6 million in dividends, $4.0 million in other income, and $2.0 million in interest income.

Revenues from services and fees in the Wealth Management segment decreased $15.2 million to $137.8 million during the six months ended June 30, 2022 from $153.0 million during the six months ended June 30, 2021.

The decrease in revenues was primarily due to a decrease in revenue of $15.4 million from commission fees.

Revenues from services and fees in the Auction and Liquidation segment decreased $7.0 million to $5.8 million during the six months ended June 30, 2022 from $12.9 million during the six months ended June 30, 2021.

The decrease in revenues was primarily due to fewer large retail fee liquidation engagements.

Revenues from services and fees in the Financial Consulting segment increased $4.5 million to $25.9 million during the three months ended March 31, 2022 from $21.4 million during three months ended March 31, 2021.

The increase in revenues was primarily due to increases of $3.7 million within our Advisory Services divisions, $0.7 million for real estate engagement fees, and $0.1 million for B.

Riley Operations Management engagements.

Revenues from services and fees in the Principal Investments - Communications and Other segment increased $11.0 million to $30.8 million during the three months ended March 31, 2022 from $19.8 million during the three months ended March 31, 2021.

The increase in revenues was primarily due to an increase of $12.4 million in subscription services from the acquisition of Marconi Wireless in the fourth quarter of 2021, partially offset by decreases in subscription revenue of $1.8 million for UOL and magicJack.

We expect the subscription revenue to continue to decline year over year.

Revenues from services and fees in the Brands segment increased $0.2 million to $4.6 million during the three months ended March 31, 2022 from $4.4 million during the three months ended March 31, 2021.

Revenues from services and fees in the Financial Consulting segment increased $5.1 million to $50.2 million during the six months ended June 30, 2022 from $45.1 million during six months ended June 30, 2021.

The increase in revenues was primarily due to increases of $1.8 million within our Advisory Services divisions and $3.3 million within our Real Estate division.

Revenues from services and fees in the Principal Investments - Communications and Other segment increased $32.7 million to $71.4 million during the six months ended June 30, 2022 from $38.7 million during the six months ended June 30, 2021.

The increase in revenues was primarily due to an increase in subscription services of $24.8 million from the acquisition of Marconi Wireless in the fourth quarter of 2021 and $10.7 million from the acquisition of an additional equity interest in Lingo in the second quarter of 2022 and an increase in advertising licensing and other revenue of $1.6 million, partially offset by a decrease of $4.3 million in subscription services for UOL and magicJack.

We expect the UOL and magicJack subscription revenues to continue to decline year over year.

Revenues from services and fees in the Brands segment increased $0.8 million to $9.7 million during the six months ended June 30, 2022 from $8.9 million during the six months ended June 30, 2021.

The primary source of revenue included in this segment is the licensing of trademarks.

Trading (losses) income and fair value adjustments on loans decreased $335.3 million to a loss of $68.4 million during the three months ended March 31, 2022 compared to income of $266.9 million during the three months ended March 31, 2021.

Trading (losses) income and fair value adjustments on loans decreased $591.9 million to a loss of $292.3 million during the six months ended June 30, 2022 compared to income of $299.6 million during the six months ended June 30, 2021.

This decrease was primarily due to decreases of $588.8 million in the Capital Markets segment and $3.2 million in the Wealth Management segment.

The loss of $68.4 million during the three months ended March 31, 2022 was primarily due to realized and unrealized losses on investments made in our proprietary trading accounts of $79.3 million, partially offset by an unrealized gain on our loans receivable, at fair value of $10.9 million.

Interest income – loans and securities lending increased $24.5 million to $61.4 million during the three months ended March 31, 2022 from $36.9 million during the three months ended March 31, 2021.

Interest income from securities lending was $15.0 million and $22.9 million during the three months ended March 31, 2022 and 2021, respectively.

Interest income from loans was $46.4 million and $14.0 million during the three months ended March 31, 2022 and 2021, respectively.

The loss of $292.3 million during the six months ended June 30, 2022 was primarily due to realized and unrealized losses on investments made in our proprietary trading accounts of $299.1 million, partially offset by realized gain on disposal of equity method investment of $6.8 million.

Interest income – loans and securities lending increased $62.9 million to $125.3 million during the six months ended June 30, 2022 from $62.4 million during the six months ended June 30, 2021.

Interest income from securities lending was $33.7 million and $36.8 million during the six months ended June 30, 2022 and 2021, respectively.

Interest income from loans was $91.5 million and $25.6 million during the six months ended June 30, 2022 and 2021, respectively.

Revenues – Sale of Goods

Revenues from the sale of goods decreased $5.0 million to $1.9 million during the three months ended March 31, 2022 from $6.8 million during three months ended March 31, 2021.

Revenues from the sale of goods decreased $15.5 million to $3.8 million during the six months ended June 30, 2022 from $19.3 million during six months ended June 30, 2021.

Revenues from sale of goods were attributable to a decrease of $17.8 million from sales of retail goods related to retail liquidation engagements in Europe that ended, partially offset by an increase of $2.6 million from sales of retail goods due to the acquisition of Marconi Wireless in the fourth quarter of 2021.

Cost of goods sold for three months ended March 31, 2022 was $2.3 million, resulting in a negative gross margin of 19.9%.

Cost of goods sold for six months ended June 30, 2022 was $4.2 million, resulting in a negative gross margin of 12.7%.

Operating Expenses

Direct Cost of Services

Direct cost of services decreased $0.3 million to $11.7 million during the three months ended March 31, 2022 from $11.3 million during the three months ended March 31, 2021.

The activity is primarily driven by the Auction and Liquidation segment and Principal Investments — Communications and Other segment.

Direct cost of services increased $6.0 million to $29.4 million during the six months ended June 30, 2022 from $23.4 million during the six months ended June 30, 2021.

The increase in direct cost of services was primarily driven by an increase of $16.5 million in the Principal Investments — Communications and Other segment, partially offset by a decrease of $10.5 million in the Auction and Liquidation segment.

The increase in the Principal Investments —

Communications and Other segment was primarily due to increases of $10.4 million from the acquisition Marconi Wireless in the fourth quarter of 2021 and $7.5 million from the acquisition of Lingo in the second quarter of 2022.

The decrease in the Auction and Liquidation segment was primarily due to retail liquidation engagements in Europe that ended.

Selling, General and Administrative Expenses

Selling, general and administrative expenses during the three months ended March 31, 2022 and 2021 were comprised of the following:

Three Months Ended March 31, 2022 Three Months Ended

March 31, 2021 Change

Selling, general and administrative expenses during the six months ended June 30, 2022 and 2021 were comprised of the following:

Six Months Ended

June 30, 2022 Six Months Ended

June 30, 2021 Change

Amount % Amount % Amount %

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n/m - Not applicable or not meaningful.

Total selling, general and administrative expenses decreased approximately $16.1 million to $175.2 million during the three months ended March 31, 2022 from $191.3 million during the three months ended March 31, 2021.

The decrease was primarily due to a decrease of $50.9 million in the Capital Markets segment, partially offset by increases of $23.7 million in the Wealth Management segment, $4.8 million in the Principal Investments — Communications and Other segment, $3.0 million in the Corporate and Other segment, $2.9 million in the Financial Consulting segment, and $0.3 million in the Auction and Liquidation segment.

Total selling, general and administrative expenses decreased approximately $48.9 million to $342.3 million during the six months ended June 30, 2022 from $391.3 million during the six months ended June 30, 2021.

The decrease was primarily due to decrease of $68.5 million in the Capital Markets segment and $0.6 million in the Auction and Liquidation segment, partially offset by increases of $14.0 million in the Principal Investments — Communications and Other segment, $3.4 million in the Financial Consulting segment, $2.4 million in the Wealth Management segment, and $0.5 million in the Corporate and Other segment.

Capital Markets

Selling, general and administrative expenses in the Capital Markets segment decreased by $50.9 million to $36.0 million during the three months ended March 31, 2022 from $86.9 million during the three months ended March 31, 2021.

The decrease was primarily due to decreases of $28.6 million in consulting expenses, $19.2 million in payroll and related expenses, and $9.2 million from the reorganization of National, partially offset by an increases of $4.5 million from the acquisition of FocalPoint in the first quarter of 2022, $1.1 million in depreciation and amortization, and $0.4 million in other expenses.

Selling, general and administrative expenses in the Capital Markets segment decreased by $68.5 million to $84.1 million during the six months ended June 30, 2022 from $152.6 million during the six months ended June 30, 2021.

The decrease was primarily due to decreases of $43.2 million in consulting expenses and $36.2 million in payroll and related expenses, partially offset by increases of $4.9 million from the settlement of a regulatory matter, $3.1 million in depreciation and amortization, $1.9 million in other expenses and $1.3 million in business development expenses.

Wealth Management

Selling, general and administrative expenses in the Wealth Management segment increased by $23.7 million to $87.6 million during the three months ended March 31, 2022 from $63.9 million during the three months ended March 31, 2021.

The increase was primarily due to increases of $23.3 million from a full quarter's activity of National, which was acquired in February 2021, and $0.5 million in legal expenses.

Selling, general and administrative expenses in the Wealth Management segment increased by $2.4 million to $157.3 million during the six months ended June 30, 2022 from $154.9 million during the six months ended June 30, 2021.

The increase was primarily due to an increase of $4.9 million from the settlement of a regulatory matter, partially offset by decreases of $1.6 million in depreciation and amortization and $0.2 million in consulting expenses.

Auction and Liquidation

Selling, general and administrative expenses in the Auction and Liquidation segment increased $0.3 million to $1.8 million during the three months ended March 31, 2022 from $1.5 million during the three months ended March 31, 2021.

Selling, general and administrative expenses in the Auction and Liquidation segment decreased $0.6 million to $4.0 million during the six months ended June 30, 2022 from $4.6 million during the six months ended June 30, 2021.

The decrease was primarily due to business development and other expenses.

Financial Consulting

Selling, general and administrative expenses in the Financial Consulting segment increased by $2.9 million to $21.0 million during the three months ended March 31, 2022 from $18.1 million during the three months ended March 31, 2021.

The increase was primarily due to increases of $2.4 million in payroll and related expenses and $0.3 million in travel and entertainment.

Selling, general and administrative expenses in the Financial Consulting segment increased by $3.4 million to $41.1 million during the six months ended June 30, 2022 from $37.6 million during the six months ended June 30, 2021.

The increase was primarily due to increases of $2.7 million in payroll and related expenses and $0.8 million in travel and entertainment expenses.

Principal Investments — Communications and Other

Selling, general and administrative expenses in the Principal Investments — Communications and Other segment increased $4.8 million to $12.3 million for the three months ended March 31, 2022 from $7.4 million for the three months ended March 31, 2021.

The increase was primarily due to an increase of $1.8 million in payroll and related expenses, $0.9 million in communications expenses, $0.7 million in depreciation and amortization, $0.8 million from other expenses, and $0.4 million in marketing expenses.

Selling, general and administrative expenses in the Brands segment remained flat at $1.4 million during the three months ended March 31, 2022 and 2021.

Selling, general and administrative expenses in the Principal Investments — Communications and Other segment increased $14.0 million to $28.7 million for the six months ended June 30, 2022 from $14.7 million for the six months ended June 30, 2021.

The increase was primarily due to increases of $4.1 million from the acquisition of an additional equity interest in Lingo in the second quarter of 2022, $3.2 million in payroll and related expenses, $1.8 million in depreciation and amortization, $1.6 million in communications expenses, $1.1 million in transaction costs, $0.7 million in marketing expenses, $0.5 million in software and equipment expenses, $0.4 million in business development expenses, and $0.3 million in other expenses.

Selling, general and administrative expenses in the Brands segment remained flat at $2.8 million during the six months ended June 30, 2022 and 2021.

Corporate and Other

Selling, general and administrative expenses for the Corporate and Other segment increased approximately $3.0 million to $15.2 million during the three months ended March 31, 2022 from $12.2 million for the three months ended March 31, 2021.

The increase was primarily due to increases of $4.4 million in payroll and related expenses, partially offset by a decrease of $0.9 million in loss from extinguishment of debt as further discussed below and increase of $0.3 million in gain from foreign currency exchange.

During the three months ended March 31, 2022, we did not repurchase any of our senior notes.

During the three months ended March 31, 2021, we repurchased bonds with an aggregate face value of $128.2 million at par, resulting in a loss net of expenses and original issue discount of $0.9 million.

The total payment included approximately $1.6 million in accrued interest.

Selling, general and administrative expenses for the Corporate and Other segment increased approximately $0.5 million to $24.5 million during the six months ended June 30, 2022 from $24.0 million for the six months ended June 30, 2021.

The increase was primarily due to increases of $8.3 million in payroll and related expenses, partially offset by decreases of $4.5 million of change in fair value of contingent consideration and $3.4 million in other expenses.

Other Income (Expense).

Other income included interest income of $0.1 million during the three months ended March 31, 2022 and 2021.

Change in fair value of financial instruments and other in the amount of $6.0 million during the three months ended March 31, 2022 was primarily due to the change in fair value of warrant liabilities and the forgiveness of a Paycheck Protection Program loan related to FocalPoint, which was acquired in the first quarter of 2022.

Interest expense was $30.4 million during the three months ended March 31, 2022 compared to $19.8 million during the three months ended March 31, 2021.

The increase in interest expense was primarily due to increases in interest expense of $5.7 million from the issuance of senior notes, and $4.1 million and $1.1 million from the Nomura term loan and revolving credit facility, respectively, entered into in the second quarter of 2021.

During the three months ended March 31, 2022, income from equity investments was $6.8 million compared to $0.9 million during the three months ended March 31, 2021.

The increase was primarily due to $6.7 million in earnings related to the bebe equity method investment.

Other income included interest income of $0.6 million and $0.1 million during the six months ended June 30, 2022 and 2021, respectively.

Change in fair value of financial instruments and other in the amount of $10.3 million during the six months ended June 30, 2022 was primarily due to the change in fair value of warrant liabilities and the forgiveness of a Paycheck Protection Program loan issued to FocalPoint prior to its acquisition by the Company during the first quarter of 2022.

Interest expense was $62.2 million during the six months ended June 30, 2022 compared to $40.6 million during the six months ended June 30, 2021.

The increase in interest expense was primarily due to increases in interest expense of $10.7 million from the issuance of senior notes, and $8.6 million and $2.3 million from the Nomura term loan and revolving credit facility, respectively, entered into during the second quarter of 2021.

During the six months ended June 30, 2022, income from equity investments was $3.4 million compared to $0.02 million during the six months ended June 30, 2021.

The increase was primarily due to $7.0 million in earnings related to the bebe equity method investment, partially offset by $3.7 million loss recognized from the conversion of debt to equity in the acquisition of Lingo during the second quarter of 2022.

(Loss) Income Before Income Taxes .

Loss before income taxes was $12.9 million during the three months ended March 31, 2022 compared to income of $354.1 million during the three months ended March 31, 2021.

The change was primarily due to a decrease in revenue of $394.6 million and increase in interest expense of $10.7 million, partially offset by a decrease in operating expenses of approximately $26.3 million, increase in change in fair value of financial instruments and other of $6.0 million, and increase in income from equity investments of $5.9 million.

Benefit (Provision) for Income Taxes.

Benefit for income taxes was $3.7 million during the three months ended March 31, 2022 compared to a provision of $97.5 million during the three months ended March 31, 2021.

The effective income tax rate was 28.7% for the three months ended March 31, 2022 as compared to 27.5% for the three months ended March 31, 2021.

Net Income Attributable to Noncontrolling Interests .

Net income attributable to noncontrolling interests represents the proportionate share of net income generated by membership interests of partnerships that we do not own.

The net income attributable to noncontrolling interests was $0.9 million during the three months ended March 31, 2022 compared to $1.9 million during the three months ended March 31, 2021.

Loss before income taxes was $202.0 million during the six months ended June 30, 2022 compared to income of $449.1 million during the six months ended June 30, 2021.

The change was primarily due to a decrease in revenue of $688.6 million and increase in interest expense of $21.6 million, partially offset by a decrease in operating expenses of approximately $51.5 million, increase in change in fair value of financial instruments and other of $3.8 million, increase in income from equity investments of $3.4 million, and an increase in interest income of $0.5 million.

Benefit from (Provision for) Income Taxes.

Benefit from income taxes was $56.2 million during the six months ended June 30, 2022 compared to a provision of $117.4 million during the six months ended June 30, 2021.

The effective income tax rate was 27.8% for the six months ended June 30, 2022 as compared to 26.1% for the six months ended June 30, 2021.

Net Income Attributable to Noncontrolling Interests and Redeemable Noncontrolling Interests .

Net income attributable to noncontrolling interests and redeemable noncontrolling interests represents the proportionate share of net income generated by membership interests of partnerships that we do not own.

The net income attributable to

noncontrolling interests and redeemable noncontrolling interests was $4.4 million during the six months ended June 30, 2022 compared to $1.4 million during the six months ended June 30, 2021.

Net (Loss) Income Attributable to the Company .

Net loss attributable to the Company was $10.1 million during the three months ended March 31, 2022 compared to net income attributable to the Company of $254.7 million for the three months ended March 31, 2022.

The change was primarily due to a decrease in operating income of $368.3 million and an increase in interest expense of $10.7 million, partially offset by a change from provision to benefit for income taxes of

$101.2 million, increase in change in fair value of financial instruments and other of $6.0 million, increase in income from equity investments of $5.9 million, and a decrease in net income attributable to noncontrolling interests of $1.1 million.

Net loss attributable to the Company was $150.2 million during the six months ended June 30, 2022 compared to net income attributable to the Company of $330.3 million during the six months ended June 30, 2021.

The change was primarily due to a change from operating income to loss of $637.2 million, increase in interest expense of $21.6 million, and an increase in net income attributable to noncontrolling interests and redeemable noncontrolling interests of $3.1 million, partially offset by a change from provision for to benefit from income taxes of $173.6 million, increase in change in fair value of financial instruments and other of $3.8 million, increase in income from equity investments of $3.4 million, and an increase in interest income of $0.5 million.

Preferred Stock Dividends .

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On April 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

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On April 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

Net (Loss) Income Available to Common Shareholders .

Net loss available to common shareholders was $12.1 million during the three months ended March 31, 2022 compared to net income available to common shareholders of $252.9 million during the three months ended March 31, 2021.

The change was primarily due to a decrease in operating income of $368.3 million, increase in interest expense of $10.7 million, and increase in preferred stock dividends of $0.3 million, partially offset by a change from provision to benefit for income taxes of $101.2 million, increase in change in fair value of financial instruments and other of $6.0 million, increase in income from equity investments of $5.9 million, and decrease in net income attributable to noncontrolling interests of $1.1 million.

Net loss available to common shareholders was $154.2 million during the six months ended June 30, 2022 compared to net income available to common shareholders of $326.8 million during the six months ended June 30, 2021.

The change was primarily due to a change from operating income to loss of $637.2 million, increase in interest expense of $21.6 million, increase in net income attributable to noncontrolling interests and redeemable noncontrolling interests of $3.1 million, and an increase in preferred stock dividends of $0.5 million, partially offset by a change from provision for to benefit from income taxes of $173.6 million, increase in change in fair value of financial instruments and other of $3.8 million, increase in income from equity investments of $3.4 million, and an increase in interest income of $0.5 million.

Liquidity and Capital Resources

Our operations are funded through a combination of existing cash on hand, cash generated from operations, borrowings under our senior notes payable, term loans and credit facilities, and special purposes financing arrangements.

During the three months ended March 31, 2022 and 2021, we generated net loss of $9.2 million and net income of $256.6 million, respectively.

During the six months ended June 30, 2022 and 2021, we generated a net loss of $145.8 million and net income of $331.7 million, respectively.

Our net loss of $145.8 million included $292.3 million of losses that primarily related to a decrease in the fair value of our portfolio of securities and other investments owned during the six months ended June 30, 2022.

Our cash flows and profitability are impacted by capital market engagements performed on a quarterly and annual basis and amounts realized from the sale of our investments in marketable securities.

As of March 31, 2022, we had $213.6 million of unrestricted cash and cash equivalents, $0.9 million of restricted cash, $1,317.1 million of securities and other investments owned at fair value, $882.4 million of loans receivable, and $2,073.4 million of borrowings outstanding.

The borrowings outstanding of $2,073.4 million as of March 31, 2022 included $1,627.6 million of borrowings from the issuance of the series of senior notes that are due at various dates ranging from May 31, 2024 to August 31, 2028 with interest rates ranging from 5.00% to 6.75%, $342.9 million in term loans borrowed pursuant to the BRPAC and Nomura Credit Agreements discussed below, $80.0 million of revolving credit under the Nomura Credit Agreement discussed below, and $22.9 million of notes payable.

We believe that our current cash and cash equivalents, securities and other investments owned, funds available under our asset based credit facility, funds available under the BRPAC and Nomura term loans, funds available under the Nomura revolving credit facility, and cash expected to be generated from operating activities will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from issuance date of the accompanying financial statements.

As of June 30, 2022, we had $216.1 million of unrestricted cash and cash equivalents, $0.9 million of restricted cash, $1,144.9 million of securities and other investments owned at fair value, $770.8 million of loans receivable, at fair value, and $2,115.8 million of borrowings outstanding.

The borrowings outstanding of $2,115.8 million as of June 30, 2022 included $1,644.8 million of borrowings from the issuance of the series of senior notes that are due at various dates ranging from May 31, 2024 to August 31, 2028 with interest rates ranging from 5.00% to 6.75%, $367.8 million in term loans borrowed pursuant to the BRPI Acquisition Co LLC (“BRPAC”) and Nomura Credit Agreements discussed below, $80.0 million of revolving credit under the Nomura Credit Agreement discussed below, and $23.2 million of notes payable.

capital and capital expenditure requirements for at least the next 12 months from issuance date of the accompanying financial statements.

We continue to monitor our financial performance to ensure sufficient liquidity to fund operations and execute on our business plan.

From time to time, we may decide to pay dividends which will be dependent upon our financial condition and results of operations.

On April 28, 2022, we declared a regular dividend of $1.00 per share that will be paid on or about May 20, 2022 to stockholders of record as of May 11, 2022.

On July 28, 2022, we declared a regular dividend of $1.00 per share that will be paid on or about August 23, 2022 to stockholders of record as of August 11, 2022.

On April 28, 2022, we declared a regular dividend of $1.00 per share that was paid on May 20, 2022 to stockholders of record as of May 11, 2022.

On February 23, 2022, the Company declared a regular quarterly dividend of $1.00 per share, which was paid on March 23, 2022 to stockholders of record as of March 9, 2022.

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The declaration and payment of any future dividends or repurchases of our common stock will be made at the discretion of our Board of Directors and will be dependent upon our financial condition, results of operations, cash flows, capital expenditures, and other factors that may be deemed relevant by our Board of Directors.

A summary of dividend activity for the three months ended March 31, 2022 and the year ended December 31, 2021 was as follows:

A summary of dividend activity for the six months ended June 30, 2022 and the year ended December 31, 2021 was as follows:

Date Declared Date Paid Stockholder

April 28, 2022 May 20, 2022 May 11, 2022 $ 1.000 $ — $ 1.000

February 23, 2022 March 23, 2022 March 9, 2022 1.000 — 1.000

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Dividends will be payable quarterly in arrears, on or about the last day of January, April, July, and October.

As of March 31, 2022, dividends in arrears in respect of the Depositary Shares were $0.8 million.

As of June 30, 2022, dividends in arrears in respect of the Depositary Shares were $0.8 million.

On January 11, 2021, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on January 29, 2021 to holders of record as of the close of business on January 21, 2021.

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On April 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4296875 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

Holders of Series B Preferred Stock, when and as authorized by the board of directors of the Company, are entitled to cumulative cash dividends at the rate of 7.375% per annum of the $25 thousand liquidation preference ($25.00 per Depositary Share) per year (equivalent to $1,843.75 or $1.84375 per Depositary Share).

Dividends will be payable quarterly in arrears, on or about the last day of January, April, July, and October.

As of March 31, 2022, dividends in arrears in respect of the Depositary Shares were $0.5 million.

As of June 30, 2022, dividends in arrears in respect of the Depositary Shares were $0.5 million.

On January 11, 2021, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on January 29, 2021 to holders of record as of the close of business on January 21, 2021.

2 unchanged sentences

On October 6, 2021, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on November 1, 2021 to holders of record as of the close of business on October 21, 2021.

On January 10, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid January 31, 2022 to holders of record as of the close of business on January 21, 2022.

On January 10, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid

January 31, 2022 to holders of record as of the close of business on January 21, 2022.

On April 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on April 29, 2022 to holders of record as of the close of business on April 19, 2022.

On July 7, 2022, the Company declared a cash dividend $0.4609375 per Depositary Share, which was paid on July 29, 2022 to holders of record as of the close of business on July 19, 2022.

Our principal sources of liquidity to finance our business is our existing cash on hand, cash flows generated from operating activities, funds available under revolving credit facilities and special purpose financing arrangements.

Cash Flow Summary

Three Months Ended

Six Months Ended

(Dollars in thousands)

4 unchanged sentences

Effect of foreign currency on cash (3,027) (534)

Net increase in cash, cash equivalents and restricted cash $ (65,348) $ 141,285

Cash used in operating activities was $14.9 million during the three months ended March 31, 2022 compared to cash used in operating activities of $42.9 million during the three months ended March 31, 2021.

Cash used in operating activities for the three months ended March 31, 2022 consisted of the negative impact of net loss of $9.2 million, noncash items of $42.7 million, and changes in operating assets and liabilities of $37.0 million.

The negative cash flow impact from noncash items of $42.7 million included deferred income taxes of $41.9 million, fair value adjustments of $15.8 million, income from equity investments of $6.8 million, noncash interest and other of $3.6 million, and gain on extinguishment of loan of $1.1 million, partially offset by share-based compensation of $17.0 million, depreciation and amortization of $7.8 million, dividends from equity investments of $0.8 million, provision for doubtful accounts of $0.4 million, gain on disposal of fixed assets and other of $0.3 million, and income allocated for mandatorily redeemable noncontrolling interests of $0.2 million.

Cash used in operating activities for the three months ended March 31, 2021 consisted of the positive impact of net income of $256.6 million and noncash items of $56.5 million, partially offset by the negative impact of changes in operating assets and liabilities of $356.0 million.

The positive cash flow impact from noncash items of $56.5 million included deferred income taxes of $62.7 million, depreciation and amortization of $6.8 million, share-based compensation of $5.5 million, loss on extinguishment of debt of $0.9 million, provision for doubtful accounts of $0.4 million, dividends from equity investments of $0.3 million, and income allocated for mandatorily redeemable noncontrolling interests of $0.1 million, partially offset by fair value adjustments of $10.7 million, noncash interest and other of $4.4 million, gain on equity investment of $3.5 million, income from equity investments of $0.9 million, and effect of foreign currency on operations of $0.7 million.

Cash used in investing activities was $35.5 million during the three months ended March 31, 2022 compared to cash used in investing activities of $171.8 million for the three months ended March 31, 2021.

During the three months ended March 31, 2022, cash used in investing activities consisted of cash used for purchases of loans receivable of $93.9 million acquisition of businesses of $40.0 million, purchases of equity and other investments of $2.4 million, and purchases of property and equipment of $0.2 million partially offset by cash received from loans receivable repayment of $101.0 million.

During the three months ended March 31, 2021, cash used in investing activities consisted of cash used to fund a trust account for the future redemption of one of our subsidiaries’ redeemable common stock of $172.5 million, purchases of loans receivable of $75.7 million, repayments of loan participations sold of $6.1 million, purchases of equity and other investments of $4.7 million, acquisition of business of $0.3 million, and purchases of property and equipment of $0.1 million, partially offset by cash received from loans receivable repayment of $87.5 million.

Cash used in financing activities was $14.4 million during the three months ended March 31, 2022 compared to cash provided by financing activities of $356.7 million during the three months ended March 31, 2021.

During the three months ended March 31, 2022, cash used in financing activities primarily consisted of $27.9 million used to pay dividends on our common shares, $4.1 million used in the repayment of term loan, $1.1 million in distributions to noncontrolling interests, $2.0 million used to pay dividends on our preferred shares, $1.3 million used in payment of employment taxes on vesting of restricted stock, and $0.4 million used to repay our notes payable, partially offset by cash provided by $20.0 million proceeds from issuance of senior notes, $1.8 million contributions from noncontrolling interests, and $0.6 million proceeds from issuance of preferred stock.

During the three months ended March 31, 2021, cash provided by financing activities primarily consisted of $402.4 million proceeds from issuance of senior notes, $172.5 million proceeds from initial public offering of subsidiaries, $64.7 million proceeds from issuance of common stock, and $3.7 million contributions from noncontrolling interests, partially offset by $128.2 million used to repurchase our senior notes, $95.2 million used to pay dividends on our common shares, $37.6 million used to repay our notes payable, $11.6 million distributions to noncontrolling interests, $7.5 million used to pay debt issuance costs, $4.8 million used for repayment on our term loan, and $1.7 million used to pay dividends on our preferred shares.

Net (decrease) increase in cash, cash equivalents and restricted cash $ (62,834) $ 193,894

Cash used in operating activities was $49.9 million during the six months ended June 30, 2022 compared to cash used in operating activities of $147.9 million during the six months ended June 30, 2021.

Cash used in operating activities for the six months ended June 30, 2022 consisted of the negative impact of net loss of $145.8 million, noncash items of $70.4 million, and changes in operating assets and liabilities of $166.2 million.

The negative cash flow impact from noncash items of $70.4 million included deferred income taxes of $95.3 million, fair value adjustments of $13.6 million, gain on equity investment of $6.8 million, income from equity investments of $3.4 million, noncash interest and other of $1.2 million, and gain on extinguishment of loan of $1.1 million, partially offset by share-based compensation of $31.2 million, depreciation and amortization of $15.8 million, dividends from equity investments of $1.9 million, provision for doubtful accounts of $1.3 million, income allocated for mandatorily redeemable noncontrolling interests of $0.4 million, effect of foreign currency of $0.3 million, and loss on disposal of fixed assets of $0.1 million.

Cash used in operating activities for the six months ended June 30, 2021 consisted of the positive impact of net income of $331.7 million and noncash items of $50.2 million, partially offset by the negative impact of changes in operating assets and liabilities of $529.8 million.

The positive cash flow impact from noncash items of $50.2 million included deferred income taxes of $51.2 million, share-based compensation of $14.1 million, depreciation and amortization of $12.9 million, loss on extinguishment of debt of $0.9 million, provision for doubtful accounts of $0.8 million, dividends from equity investments of $0.6 million, and income allocated for mandatorily redeemable noncontrolling interests of $0.3 million, partially offset by fair value adjustments of $10.0 million, noncash interest and other of $9.1 million, gain on extinguishment of loans of $6.5 million gain on equity investment of $3.5 million, and effect of foreign currency on operations of $1.5 million.

Cash used in investing activities was $0.5 million during the six months ended June 30, 2022 compared to cash used in investing activities of $358.7 million for the six months ended June 30, 2021.

During the six months ended June 30, 2022, cash used in investing activities consisted of cash used for purchases of loans receivable of $199.1 million, acquisition of businesses of $38.4 million, purchases of equity and other investments of $2.8 million, and purchases of property and equipment of $0.9 million, partially offset by cash received from loans receivable repayment of $241.7 million.

During the six months ended June 30, 2021, cash used in investing activities consisted of cash used to fund a trust account for the future redemption of one of our subsidiaries’ redeemable common stock of $345.0 million, purchases of loans receivable of $87.3 million, repayments of loan participations sold of $10.8 million, purchases of equity and other investments of $10.5 million, acquisition of business of $0.4 million, and purchases of property and equipment of $0.3 million, partially offset by cash received from loans receivable repayment of $95.5 million.

Cash used in financing activities was $10.4 million during the six months ended June 30, 2022 compared to cash provided by financing activities of $701.1 million during the six months ended June 30, 2021.

During the six months ended June 30, 2022, cash used in financing activities primarily consisted of $62.0 million used to pay dividends on our common shares, $54.3 million used in the repayment of term loan, $6.4 million used in payment of employment taxes on vesting of restricted stock, $4.0 million used to pay dividends on our preferred shares, $2.4 million in distributions to noncontrolling interests, $0.5 million used in the payment of contingent consideration, $0.5 million used in the payment of debt issuance

and offering costs, and $0.4 million used to repay our notes payable, partially offset by cash provided by $75.0 million proceeds from borrowings under a term loan, $35.9 million proceeds from issuance of senior notes, $8.5 million contributions from noncontrolling interests, and $0.6 million proceeds from issuance of preferred stock.

During the six months ended June 30, 2021, cash provided by financing activities primarily consisted of $475.7 million proceeds from issuance of senior notes, $345.0 million proceeds from initial public offering of subsidiaries, $200.0 million proceeds from the Nomura term loan, $64.7 million proceeds from issuance of common stock, $10.7 million contributions from noncontrolling interests, and $8.3 million net proceeds from offerings of preferred stock, partially offset by $181.3 million used to pay dividends on our common shares, $128.2 million used to repurchase our senior notes, $37.6 million used to repay our notes payable, $15.7 million used to pay debt issuance costs, $14.8 million distributions to noncontrolling interests, $11.5 million used for repayment on the BRPAC term loan, $10.4 million used to pay employment taxes on vesting of restricted stock, and $3.5 million used to pay dividends on our preferred shares.

Credit Agreements

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Quarterly installments from September 30, 2022 to March 31, 2025 are in the amount of $3.8 million per quarter.

As of March 31, 2022 and December 31, 2021, the outstanding balances on the Term Loan Facility and Incremental Facility were $293.2 million (net of unamortized debt issuance costs of $6.8 million) and $292.7 million (net of unamortized debt issuance costs of $7.4 million), respectively.

Interest on the term loan during the three months ended March 31, 2022 was $4.1 million (including amortization of deferred debt issuance costs of $0.5 million).

The interest rate on the term loan as of March 31, 2022 and December 31, 2021 was 5.46% and 4.72%, respectively.

We had an outstanding balance of $80.0 million under the Revolving Credit Facility as of both March 31, 2022 and December 31, 2021.

Interest on the revolving facility during the three months ended March 31, 2022 was $1.1 million (including amortization of deferred financing costs of $0.1 million).

The interest rate on the Revolving Credit Facility as of March 31, 2022 and December 31, 2021 was 5.01% and 4.67%, respectively.

We are in compliance with all financial covenants in the Credit Agreement as of March 31, 2022.

As of June 30, 2022 and December 31, 2021, the outstanding balances on the Term Loan Facility and Incremental Facility were $293.7 million (net of unamortized debt issuance costs of $6.3 million) and $292.7 million (net of

unamortized debt issuance costs of $7.4 million), respectively.

Interest on the term loan during the three months ended June 30, 2022 and 2021 was $4.7 million (including amortization of deferred debt issuance costs of $0.5 million) and $0.2 million (including amortization of deferred debt issuance costs of $0.03 million), respectively.

Interest on the term loan during the six months ended June 30, 2022 and 2021 was $8.8 million (including amortization of deferred debt issuance costs of $1.0 million) and $0.2 million (including amortization of deferred debt issuance costs of $0.03 million), respectively.

The interest rate on the term loan as of June 30, 2022 and December 31, 2021 was 6.65% and 4.72%, respectively.

We had an outstanding balance of $80.0 million under the Revolving Credit Facility as of June 30, 2022 and December 31, 2021.

Interest on the revolving facility during the three and six months ended June 30, 2022 was $1.2 million (including amortization of deferred financing costs of $0.1 million) and $2.3 million (including amortization of deferred financing costs of $0.3 million), respectively.

The unused commitment fee on the revolving facility for the three and six months ended June 30, 2021 was $0.03 million (including amortization of deferred financing costs of $0.01 million).

The interest rate on the Revolving Credit Facility as of June 30, 2022 and December 31, 2021 was 6.13% and 4.67%, respectively.

We are in compliance with all financial covenants in the Credit Agreement as of June 30, 2022.

Wells Fargo Credit Agreement

7 unchanged sentences

The credit facility also provides for funding fees in the amount of 0.05% to 0.20% of the aggregate principal amount of all credit advances and letters of credit issued in connection with a liquidation sale.

There was no outstanding balance on this credit facility as of March 31, 2022 and December 31, 2021.

As of March 31, 2022 and December 31, 2021, there were no open letters of credit outstanding.

We are in compliance with all financial covenants in the asset based credit facility as of March 31, 2022.

There was no outstanding balance on this credit facility as of June 30, 2022 and December 31, 2021.

As of June 30, 2022 and December 31, 2021, there were no open letters of credit outstanding.

We are in compliance with all financial covenants in the asset based credit facility as of June 30, 2022.

BRPAC Credit Agreement

1 unchanged sentence

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

Under the BRPAC Credit Agreement, we borrowed $80.0 million due December 19, 2023.

Pursuant to the terms of the BRPAC Credit Agreement, we may request additional optional term loans in an aggregate principal amount of up to $10.0 million at any time prior to the first anniversary of the agreement date.

On February 1, 2019, the Borrowers entered into the First Amendment to Credit Agreement and Joinder with City National Bank as a new lender in which the new lender extended to Borrowers the additional $10.0 million.

On December 31, 2020, the Borrowers, the Secured Guarantors, the Agent, and the Closing Date Lenders, entered into the Second Amendment to Credit Agreement (the “Second Amendment”) pursuant to which, among other things, (i) the Lenders agreed to make a new $75.0 million term loan to the Borrowers, the proceeds of which the Borrowers’ will use to repay the outstanding principal amount of the existing Terms Loans and Optional Loans and for other general corporate purposes, (ii) the Borrowers were permitted to make a one-time Permitted Distribution (as defined in the Second Amendment) in the amount of $30.0 million on the date of the Second Amendment, (iii) the maturity date of the new Term Loans is five (5) years from the date of the Second Amendment, (iv) the interest rate margin was increased by 25 basis points as set forth in the Second Amendment, (v) the Borrowers agreed to make mandatory prepayments of the Term Loans from a portion of the Consolidated Excess Cash Flow (as defined in the Credit Agreement), (vi) the maximum Consolidated Total Funded Debt Ratio (as defined in the Credit Agreement) was increased as set forth in the Second Amendment and (vii) the Company and B.

Riley Principal Investments, LLC entered into a reaffirmation of their guarantees of the Borrowers’ obligations under the Credit Agreement.

Additionally, the Borrowers paid a commitment fee and an arrangement fee, each based on a percentage of the aggregate commitments, in each case upon the closing of the Second Amendment.

On December 16, 2021, the Borrowers, the Secured Guarantors, the Agent, and the Closing Date Lenders, entered into the Third Amendment to Credit Agreement (the “Third Amendment”), which, among other things, replaced LIBOR with the SOFR reference rate and pursuant to which the Borrowers were permitted to make a one-time Permitted Distribution (as defined in the Third Amendment) in the amount of $15.0 million on the date of the Third Amendment.

The borrowings under the amended BRPAC Credit Agreement bear interest equal to the SOFR rate plus a margin of 2.75% to 3.25% per annum, depending on the Borrowers’ consolidated total funded debt ratio as defined in the BRPAC Credit Agreement.

As of March 31, 2022 and December 31, 2021, the interest rate on the amended BRPAC Credit Agreement was at 3.26% and 3.17%, respectively.

Through a series of amendments, including the most recent Fourth Amendment to the BRPAC Credit Agreement (the “Fourth Amendment”) on June 21, 2022, the Borrowers, the Secured Guarantors, the Agent and the Closing Date Lenders agreed to the following, among other things:

(i) the Lenders agreed to make a new $75.0 million term loan to the Borrowers, the proceeds of which the Borrowers’ used to repay the outstanding principal amount of the existing terms loans and optional loans and will use for other general corporate purposes, (ii) a new applicable margin level of 3.50% was established as set forth from the date of the Fourth Amendment, (iii) Marconi Wireless Holdings, LLC was added to the Borrowers, (iv) the maturity date of the term loan was set to June 30, 2027, and (v) the Borrowers were permitted to make certain distributions to the parent company of the Borrowers.

The borrowings under the amended BRPAC Credit Agreement bear interest equal to the SOFR rate plus a margin of 2.75% to 3.50% per annum, depending on the Borrowers’ consolidated total funded debt ratio as defined in the BRPAC

Credit Agreement.

As of June 30, 2022 and December 31, 2021, the interest rate on the amended BRPAC Credit Agreement was at 4.66% and 3.17%, respectively.

Principal outstanding under the amended BRPAC Credit Agreement is due in quarterly installments.

Quarterly installments from June 30, 2022 to December 31, 2022 are in the amount of $4.1 million per quarter, from March 31, 2023

to December 31, 2023 are in the amount of $3.6 million per quarter, from March 31, 2024 to December 31, 2024 are in the amount of $3.1 million per quarter, from March 31, 2025 to December 31, 2025 are $2.7 million per quarter , and the remaining principal balance is due at final maturity on December 31, 2025 .

As of March 31, 2022 and December 31, 2021, the outstanding balance on the term loan was $49.7 million (net of unamortized debt issuance costs of $0.5 million), and $53.7 million (net of unamortized debt issuance costs of $0.6 million), respectively.

Interest expense on the term loan during the three months ended March 31, 2022 and 2021, was $0.5 million (including amortization of deferred debt issuance costs of $0.1 million ) and $0.7 million (including amortization of deferred debt issuance costs of $0.08 million ), respectively.

We are in compliance with all financial covenants in the amended BRPAC Credit Agreement as of March 31, 2022.

Quarterly installments from September 30, 2022 to December 31, 2022 are in the amount of $2.8 million per quarter, from March 31, 2023 to December 31, 2023 are in the amount of $4.7 million per quarter, from March 31, 2024 to December 31, 2026 are in the amount of $3.8 million per quarter, on March 31, 2027 is in the amount of $2.8 million, and the remaining principal balance is due at final maturity on June 30, 2027 .

As of June 30, 2022 and December 31, 2021, the outstanding balance on the term loan was $74.1 million (net of unamortized debt issuance costs of $0.9 million), and $53.7 million (net of unamortized debt issuance costs of $0.6 million), respectively.

Interest expense on the term loan during the three months ended June 30, 2022 and 2021 was $0.6 million (including amortization of deferred debt issuance costs of $0.1 million ) and $0.7 million (including amortization of deferred debt issuance costs of $0.08 million), respectively.

Interest expense on the term loan during the six months ended June 30, 2022 and 2021 was $0.6 million (including amortization of deferred debt issuance costs of $0.1 million ) and $1.4 million (including amortization of deferred debt issuance costs of $0.2 million), respectively.

We are in compliance with all financial covenants in the amended BRPAC Credit Agreement as of June 30, 2022.

Senior Note Offerings

During the three months ended March 31, 2022 and 2021, we issued $20.1 million and $12.9 million, respectively, of senior notes due with maturities dates ranging from May 2024 to August 2028 pursuant to At the Market Issuance Sales Agreements with B.

During the three months ended June 30, 2022 and 2021, we issued $15.8 million and $72.5 million, respectively, of senior notes, and during the six months ended June 30, 2022 and 2021, we issued $35.9 million and $85.3 million, respectively, of senior notes due with maturities dates ranging from May 2024 to August 2028 pursuant to At the Market Issuance Sales Agreements with B.

Riley Securities, Inc.

1 unchanged sentence

A series of prospectus supplements were filed by the Company with the SEC which allowed the Company to sell these senior notes.

As of March 31, 2022 and December 31, 2021, the total senior notes outstanding was $1,627.6 million (net of unamortized debt issue costs of $20.5 million) and $1,606.6 million (net of unamortized debt issue costs of $21.5 million) with a weighted average interest rate of 5.69% and 5.69%, respectively.

As of June 30, 2022 and December 31, 2021, the total senior notes outstanding was $1,644.8 million (net of unamortized debt issue costs of $19.1 million) and $1,606.6 million (net of unamortized debt issue costs of $21.5 million) with a weighted average interest rate of 5.70% and 5.69%, respectively.

Interest on senior notes is payable on a quarterly basis.

Interest expense on senior notes totaled $24.4 million and $18.7 million during the three months ended March 31, 2022 and 2021, respectively.

Interest expense on senior notes totaled $24.7 million and $20.0 million for the three months ended June 30, 2022 and 2021, respectively, and totaled $49.1 million and $38.6 million for the six months ended June 30, 2022 and 2021, respectively.

The most recent sales agreement prospectus was filed by us with the SEC on January 5, 2022 (the “January 2022 Sales Agreement Prospectus”), supplementing the prospectus filed on August 11, 2021, the prospectus filed on April 6, 2021, and the prospectus filed on January 28, 2021.

This program provides for the sale by the Company of up to $250.0 million of certain of the Company’s senior notes.

As of March 31, 2022, and December 31, 2021 the Company had $91.8 million and $111.9 million, respectively, remaining availability under the January 2022 Sales Agreement.

As of June 30, 2022, and December 31, 2021 the Company had $76.0 million and $111.9 million, respectively, remaining availability under the January 2022 Sales Agreement.

Off Balance Sheet Arrangements

2 unchanged sentences

Recent Accounting Standards

See Note 2(t) to the accompanying financial statements for recent accounting standards we have recently adopted.

See Note 2(t) to the accompanying financial statements for recent accounting standards we have not yet adopted and recently adopted.

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 2. Management’s Discussion and Analysis