S-1/A 1 ny20003971x3_s1a.htm S-1/A

As filed with the U.S. Securities and Exchange Commission on June 6, 2022

Registration No. 333-264692

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Amendment No. 2

FORM S-1/A

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Great Elm Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware			7272			85-3622015
(State or other jurisdiction of incorporation or organization)			(Primary Standard Industrial Classification Code Number)			(I.R.S. Employer Identification Number)

800 South Street, Suite 230

Waltham, MA 02453

(617) 375-3006

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of registrant’s principal executive offices)

Peter A. Reed

Chief Executive Officer

Great Elm Group, Inc.

800 South Street, Suite 230

Waltham, MA 02453

(617) 375-3006

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Rory T. Hood

Ferrell M. Keel

Jones Day

250 Vesey Street

New York, New York 10281

(212) 326-3939

William J. Tuttle

Kirkland & Ellis LLP

1301 Pennsylvania Ave., N.W.

Washington, DC 20004

(202) 389-5000

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐						Accelerated filer ☐
Non-accelerated filer ☒						Smaller reporting company ☒
						Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

	Per Note	Total
Public offering price	$	$
Underwriting discount and commissions	$	$
Proceeds to us, before expenses⁽¹⁾	$	$

			Page
About This Prospectus			ii
Prospectus Summary			1
Summary Selected Financial Data			4
The Offering			5
Risk Factors			12
Cautionary Note Regarding Forward-Looking Statements			15
Use of Proceeds			16
Capitalization			17
Description of the Notes			18
Description of Other Indebtedness and Securities			28
Certain Material U.S. Federal Income Tax Considerations			29
Underwriting			34
Legal Matters			37
Experts			37
Where You Can Find More Information			38
Incorporation by Reference			39

Selected Consolidated Statements of Operations Data:	For the years ended June 30,		For the nine months ended March 31,
(in thousands except per share data)	2021	2020	2022	2021
Total revenues	$60,853	$58,994	$49,909	$44,531
Total operating costs and expenses	(64,590)	(61,165)	(52,712)	(48,697)
Operating loss from continuing operations	(3,737)	(2,171)	(2,803)	(4,166)
Loss from continuing operations	(8,519)	(13,124)	(10,188)	(7,440)
Discontinued operations:
Income from discontinued operations, net of tax	386	219	—	211
Gain on sale of discontinued operations	263	—	—	—
Total income from discontinued operations	649	219	—	211
Net loss	$(7,870)	$(12,905)	$(10,188)	$(7,229)
Basic and diluted income (loss) per share
Continuing operations	$(0.31)	$(0.51)	$(0.38)	$(0.25)
Discontinued operations	0.03	0.01	—	0.00
Net loss per share	$(0.28)	$(0.50)	$(0.38)	$(0.25)
Shares used in computing basic and diluted income (loss) per share:	25,722	25,418	26,963	25,669

Selected Consolidated Balance Sheet Data:	As of June 30,		As of March 31,
(in thousands)	2021	2020	2022	2021
Cash and cash equivalents	$24,382	$40,500	$22,746	$24,302
Investments	24,044	8,705	19,160	18,835
Investments in consolidated funds	26,490	—	11,340	25,625
Goodwill	50,536	50,010	52,463	50,658
Total assets	161,869	195,445	137,465	215,257
Related party note payable	—	27,903	—	—
Equipment financing debt	2,041	2,230	2,711	2,238
Convertible notes	33,333	29,393	34,278	32,487
Redeemable preferred stock of subsidiaries	35,529	—	35,694	35,474
Total liabilities	106,445	138,807	90,485	159,634
Contingently redeemable non-controlling interest	2,639	3,890	2,262	2,055
Stockholders’ equity	52,785	52,748	44,718	53,568

Dollar amounts in thousands (except per share amounts)	Actual as of March 31, 2022	As Adjusted⁽¹⁾
	(Unaudited)
Cash and cash equivalents⁽²⁾	$22,746	$
DME Revolver⁽³⁾	—	—
Convertible notes (face value $35,205, including $16,637 held by related parties)	34,278	34,278
Notes offered hereby	—	30,000
Stockholders’ equity:
Common stock, $0.001 par value; 350,000,000 shares authorized and 27,464,767 shares issued and 26,963,203 outstanding	27	27
Preferred stock, $ 0.001 par value; 5,000,000 authorized and zero outstanding	—	—
Additional paid-in capital	3,309,704	3,309,704
Accumulated deficit	(3,274,750)	(3,274,750)
Total stockholders’ equity	$44,718	$44,718

Underwriters			Principal Amount of Notes
Oppenheimer & Co. Inc.			$
B. Riley Securities, Inc.
Janney Montgomery Scott LLC
Ladenburg Thalmann & Co. Inc.
Total			$30,000,000

	Per Note	Without Over- Allotment Option	With Over- Allotment Option
Public offering price	$	$	$
Underwriting discount and commissions ( % of public offering price)	$	$	$
Proceeds (before expenses)	$	$	$

Item			Amount
SEC Registration Fee			$3,198
Printing Fees and Expenses			35,000
Nasdaq Listing Fees and Expenses			5,000
Legal Fees and Expenses			325,000
Accounting Fees and Expenses			165,500
Ratings Agency Fees and Expenses			90,000
Miscellaneous Expenses			15,000
Total			$638,698

Exhibit No.			Description
1.1+			Form of Underwriting Agreement
2.1*			Agreement and Plan of Merger, dated December 21, 2020, by and among Great Elm Capital Group, Inc., Great Elm Group, Inc. and Forest Merger Sub, Inc. (incorporated by reference to Exhibit 2.1 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
2.2*			Purchase Agreement by and among Great Elm FM Acquisition, Inc. and Monomoy Properties Fort Myers FL, LLC, dated June 23, 2021 (incorporated by reference to Exhibit 2.1 to the Form 8-K of Great Elm Group, Inc. filed on June 24, 2021)
2.3*			Asset Purchase Agreement, by and between Great Elm Capital Management, Inc. and Imperial Capital Asset Management, LLC, dated May 4, 2022 (incorporated by reference to Exhibit 2.1 to the Form 8-K of Great Elm Group, Inc. filed on May 5, 2022)
3.1			Certificate of Incorporation of Great Elm Group, Inc. (incorporated by reference to Exhibit 3.1 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
3.2			Bylaws of Great Elm Group, Inc. (incorporated by reference to Exhibit 3.2 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
4.1+			Form of Base Indenture
4.2+			Form of First Supplemental Indenture
4.3+			Form of Notes (included as Exhibit A to Exhibit 4.2 above)
4.4			Form of the Registrant’s Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
4.5			Certificate of Designation of Series A Junior Participating Cumulative Preferred Stock of the Registrant, dated December 23, 2020 (incorporated by reference to Exhibit 4.2 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
4.6			Stockholders’ Rights Agreement, dated December 29, 2020, by and between the Registrant and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 4.3 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
4.7			Form of 5.0% Convertible Senior PIK Notes due 2030 (incorporated by reference to Exhibit 4.4 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
4.8			Form of Amendment to 5.0% Convertible Senior PIK Notes due 2030 (incorporated by reference to Exhibit 4.1 to the Form 10-Q of Great Elm Group, Inc. filed on May 14, 2021)
4.9			Registration Rights Agreement, dated as of February 26, 2020, by and between Great Elm Capital Group, Inc. and certain accredited investors party thereto (incorporated by reference to Exhibit 4.5 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
5.1†			Opinion of Jones Day
10.1^			Offer Letter, dated December 29, 2020 between Peter A. Reed and the Registrant (incorporated by reference to Exhibit 10.1 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
10.2^			Offer Letter, dated December 29, 2020 between Adam Kleinman and the Registrant (incorporated by reference to Exhibit 10.2 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
10.3^			Offer Letter, dated December 29, 2020 between Brent Pearson and the Registrant (incorporated by reference to Exhibit 10.3 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
10.4^			Compensation Plan Agreement, dated December 29, 2020, by and between Great Elm Capital Group, Inc. and the Registrant (incorporated by reference to Exhibit 10.4 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
10.5^			Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.5 to the Form 8-K of Great Elm Group, Inc. filed on December 29, 2020)
10.6^			Form of Performance Stock Award (incorporated by reference to Exhibit 10.8 to the Form 8-K of Great Elm Capital Group, Inc. filed on November 9, 2016)

Exhibit No.			Description
10.7^			Form of US Stock Option Agreement (incorporated by reference to Exhibit 10.3 to the Form 10-Q of Great Elm Capital Group, Inc. filed on May 12, 2004)
10.8^			Second Amended and Restated 2006 Stock Incentive Plan, amended and restated effective November 12, 2013 (incorporated by reference to Exhibit 10.1 to the Form 10-Q of Great Elm Capital Group, Inc. filed on February 7, 2014)
10.9^			Form of 2006 Stock Incentive Plan Restricted Stock Unit Grant Notice (incorporated by reference to Exhibit 10.9 to the Form 10-Q of Great Elm Capital Group, Inc. filed on February 8, 2012)
10.10^			Second Amended and Restated 1999 Directors’ Equity Compensation Plan, amended and restated effective September 13, 2013 and November 12, 2013 (incorporated by reference to Exhibit 10.2 to the Form 10-Q of Great Elm Capital Group, Inc. filed on February 7, 2014)
10.11^			Form of Notice of Stock Option Grant and Form of Stock Option Agreement under the Registrant’s Amended and Restated 1999 Directors’ Equity Compensation Plan (incorporated by reference to Exhibit 99.2 to the Form S-8 of Great Elm Capital Group, Inc. filed on December 4, 2009)
10.12^			Form of Notice of Restricted Stock Bonus Grant and Form of Restricted Stock Bonus Agreement under the Registrant’s Amended and Restated 1999 Directors’ Equity Compensation Plan (incorporated by reference to Exhibit 99.3 to the Form S-8 of Great Elm Capital Group, Inc. filed on December 4, 2009)
10.13^			Great Elm Group, Inc. Amended and Restated 2016 Long-Term Incentive Compensation Plan (As Amended, Effective November 17, 2021) (incorporated by reference to Exhibit 10.1 to the Form 8-K of Great Elm Group, Inc. filed on November 17, 2021)
10.14^			2016 Employee Stock Purchase Plan (incorporated by reference to Annex E to the Proxy Statement of Great Elm Capital Group, Inc. filed on May 25, 2016)
10.15^			Form of Amended and Restated Notice of Performance Stock Award (incorporated by reference to Exhibit 10.5 to the Form 8-K of Great Elm Capital Group, Inc. filed on September 20, 2017)
10.16^			Form of Restricted Stock Unit Award (Directors) under the Registrant’s Amended and Restated 2016 Long-Term Incentive Compensation Plan (incorporated by reference to Exhibit 10.16 to the Form 10-K of Great Elm Group, Inc. filed on September 21, 2021)
10.17^			Form of Restricted Stock Unit Award (Employees) under the Registrant’s Amended and Restated 2016 Long-Term Incentive Compensation Plan (incorporated by reference to Exhibit 10.17 to the Form 10-K of Great Elm Group, Inc. filed on September 21, 2021)
10.18^			Amended and Restated Great Elm Capital Management Performance Bonus Plan, dated February 6, 2019, (incorporated by reference to Exhibit 10.1 to the Form 8-K of Great Elm Capital Group, Inc. filed on February 8, 2019)
10.19			Transaction Agreement, dated March 10, 2021, by and among the Registrant, MAST Capital Management, LLC and David Steinberg (incorporated by reference to Exhibit 10.1 to the Form 10-Q of Great Elm Group, Inc. filed on May 14, 2021)
10.20			Investment Management Agreement, dated as of September 27, 2016, by and between Great Elm Capital Corp. and Great Elm Capital Management, Inc. (incorporated by reference to Exhibit 10.1 to the Form 8-K of Great Elm Capital Corp. filed on November 7, 2016)
10.21			Administration Agreement, dated as of September 27, 2016, by and between Great Elm Capital Corp. and Great Elm Capital Management, Inc. (incorporated by reference to Exhibit 10.2 to the Form 8-K of Great Elm Capital Corp. filed on November 7, 2016)
10.22			Profit Sharing Agreement, dated as of November 3, 2016, by and between Great Elm Capital Management, Inc. and Great Elm Capital GP, LLC (formerly GECC GP Corp.) (incorporated by reference to Exhibit 10.6 to the Form 8-K of Great Elm Capital Corp. filed on November 9, 2016)
10.23*			Promissory Note, by and between Great Elm Capital Management, Inc. and Imperial Capital Asset Management, LLC, dated May 4, 2022 (incorporated by reference to Exhibit 10.1 to the Form 8-K of Great Elm Group, Inc. filed on May 5, 2022)
21.1			Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 to the Form 10-K of Great Elm Group, Inc. filed on September 21, 2021)
23.1†			Consent of Grant Thornton LLP, relating to Great Elm Group, Inc.
23.2†			Consent of Deloitte & Touche LLP, relating to Great Elm Capital Corp.

Exhibit No.			Description
23.3†			Consent of Jones Day (included in Exhibit 5.1)
24.1+			Power of Attorney (included on the signature page of this Registration Statement, as filed on May 5, 2022)
24.2†			Power of Attorney for David Matter
25.1+			Form T-1 Statement of Eligibility under Trust Indenture Act of 1939 of Trustee under the Indenture
99.1			Audited financial statements of Great Elm Capital Corp. (incorporated by reference to the Annual Report on Form 10-K/A of Great Elm Capital Corp. filed on April 19, 2022)
107.1†			Filing Fee Table

NAME			DATE

/s/ Peter A. Reed
Peter A. Reed Chief Executive Officer (Principal Executive Officer)			June 6, 2022

/s/ Brent J. Pearson
Brent J. Pearson Chief Financial Officer & Chief Accounting Officer (Principal Financial and Accounting Officer)			June 6, 2022

*
Matthew A. Drapkin Director			June 6, 2022

*
Thomas S. Harbin III Director			June 6, 2022

*
David Matter Director			June 6, 2022

*
James H. Hugar Director			June 6, 2022

*
James P. Parmelee Director			June 6, 2022

*
Jason W. Reese Director			June 6, 2022

*
Eric J. Scheyer Director			June 6, 2022

*
Jeffrey S. Serota Director			June 6, 2022

GREAT ELM GROUP, INC.

/s/ Peter A. Reed

Peter A. Reed

Chief Executive Officer

SEC Form S-1/A filed by Great Elm Group Inc. (Amendment)