B. Riley commits $560M equity and up to $57M guarantee for FRG acquisition at $30/share

BRC Group Holdings, Inc.

B. Riley agrees to contribute $560M in equity to TopCo to fund Freedom VCM's acquisition of Franchise Group (FRG) at $30 per share in cash.
B. Riley provides a limited guarantee of up to $57M covering termination fee ($55M) and certain liabilities if merger fails under specified conditions.
Buyer group includes FRG CEO Brian Kahn and a consortium with B. Riley; closing expected by Nov 10, 2023, subject to HSR and stockholder approval.
B. Riley may assign portions of its commitment to affiliates/investors; actual funding at closing expected to be substantially less than $560M.

Key facts

Extracted from this filing and checked against the source text.

Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

BRC Group Holdings, Inc. entered into Equity Commitment Letter with Freedom VCM Holdings, LLC and Freedom VCM, Inc. (Parent) valued at $560,000,000 equity financing (effective 2023-05-10).

Action: entry
Agreement: equity purchase
Counterparty: Freedom VCM Holdings, LLC and Freedom VCM, Inc. (Parent)
Value: $560,000,000 equity financing
Effective: 2023-05-10

Exact text from the filing

B. Riley entered into an Equity Commitment Letter, dated as of May 10, 2023 (the “Equity Commitment Letter”), with Freedom VCM Holdings, LLC (“TopCo”) and Parent, pursuant to which B. Riley, subject to the terms and conditions of the Equity Commitment Letter, has agreed to contribute to TopCo, at or prior to the closing of the Merger, an amount equal to $560 million in equity financing (the “B. Riley Equity Commitment”).

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

BRC Group Holdings, Inc. entered into Limited Guarantee with Franchise Group, Inc. (FRG) valued at guarantee of up to $57,000,000 for certain liabilities, including a termination fee of $55,000,000 (effective 2023-05-10).

Action: entry
Agreement: merger
Counterparty: Franchise Group, Inc. (FRG)
Value: guarantee of up to $57,000,000 for certain liabilities, including a termination fee of $55,000,000
Effective: 2023-05-10

Exact text from the filing

B. Riley and FRG entered into a Limited Guarantee dated as of May 10, 2023 (the “Limited Guarantee”) in favor of FRG, pursuant to which B. Riley agreed to guarantee to FRG the due and punctual payment, performance and discharge when required by Parent or Merger Sub to FRG of certain liabilities and obligations of Parent or Merger Sub under the Merger Agreement pursuant to and in accordance therewith, including (i) a termination fee due to FRG in the amount of $55,000,000 if the Merger Agreement is terminated under certain specified circumstances provided for in the Merger Agreement; (ii) certain reimbursement obligations of Parent when required to be paid by Parent pursuant to the Merger Agreement; and (iii) liabilities or damages resulting from any actual fraud or Willful and Material Breach (as defined in the Merger Agreement) by Parent or Merger Sub required to be paid by Parent or Merger Sub pursuant to the Merger Agreement; provided, that, except in the case of actual fraud or Wil

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BRC Group Holdings, Inc. filing history →

Source: SEC EDGAR

accession 0001213900-23-038268

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