Item
1.05 Material Cybersecurity Incidents
On April 5, 2024, Targus International,
LLC and certain affiliates (collectively, "Targus"), each of which is an indirect subsidiary of B. Riley Financial, Inc. (the
"Company"), discovered that a threat actor gained unauthorized access to certain of Targus' file systems. Upon discovery
and with assistance from external cybersecurity counsel and consultants, Targus immediately activated its incident response and business
continuity protocols to investigate, contain and remediate the incident. Through this process, proactive containment measures to disrupt
unauthorized access resulted in a temporary interruption in the business operations of the Targus network.
The incident has been contained
and Targus systems recovery efforts are in process.
While the investigation is
ongoing and the incident has temporarily disrupted Targus' business operations, as of the date of this filing, the Company does
not currently believe that this incident will materially impact the Company's financial condition or results of operations taken
as a whole. Business operations for each of the Company's other subsidiaries have continued without disruption in all material respects,
and no other Company business has been affected. Last year, Targus was not a significant contributor to the Company's Operating
Adjusted EBITDA.
Targus has notified relevant
regulatory authorities and will work with law enforcement with respect to the unauthorized access to information.
Forward-looking statements
This Current Report on Form
8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other
than statements of historical fact are forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties
and other factors which may cause the Company's performance or achievements to be materially different from any expected future
results, performance, or achievements. Forward-looking statements speak only as of the date they are made and the Company assumes no duty
to update forward-looking statements, except as required by law. Actual future results, performance or achievements may differ materially
from historical results or those anticipated depending on a variety of factors, some of which are beyond the control of the Company, including,
but not limited to, the risks described from time to time in the Company's periodic filings with the SEC, including, without limitation,
the risks described in the Company's 2022 Annual Report on Form 10-K under the captions "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations" (as applicable). Additional information will be set forth
in the Company's Annual Report on Form 10-K for the year ended 2023. These factors should be considered carefully, and readers are
cautioned not to place undue reliance on such forward-looking statements. All information is current as of the date this press release
is issued, and the Company undertakes no duty to update this information.
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