National Holdings Stockholder Settlement

Only $3.25 cash-out holders qualify. The National Holdings stockholder settlement resolves Nancy Frank, as Trustee of The Frank Trust, et al. v. Michael Mullen, C.A. No. 2023-0381-MTZ, a stockholder class action in the Court of Chancery of the State of Delaware over B. Riley Financial's February 2021 buyout of National Holdings Corporation at $3.25 a share. Four things decide whether this is worth your time, and three of them cut against the headline. First, the $10 minimum will disqualify most small holders. Paragraph 35 of the Notice provides that no distribution is made to a Claimant who would otherwise receive less than $10.00. Against the Notice's own estimate of about $0.60 a share before roughly $0.18 a share in Court-approved fees and expenses, a holder needs on the order of two dozen cashed-out shares just to clear that floor. That is arithmetic from the Notice's estimates rather than a published share threshold, but the point holds: a handful of National shares will very likely pay nothing at all. Second, the test is not simply that you owned National stock. You must have held the stock during the February 9 to February 25, 2021 window and have had those shares exchanged for $3.25 in cash in the tender offer that closed the Merger. Shares sold into the open market before that closing were never exchanged in the Merger and are outside the Class. Third, you cannot opt out of this class, and the release binds you whether or not you file. Paragraph 21 states that this is a non-opt-out class under Court of Chancery Rules 23(a), 23(b)(1) and 23(b)(2), so Class Members have no right to exclude themselves. Paragraph 36 confirms that a Class Member who files nothing is barred from the money but is still bound by the judgment and the releases. Doing nothing here is not a way of keeping your claims. Fourth, the defendant is Michael Mullen personally — not National Holdings, and not B. Riley. B. Riley Financial was dismissed from the case in May 2025, and Mullen, a former National officer, is paying the $4,350,000 himself. Anyone searching for a claim against B. Riley will not find one here. One more thing worth knowing before you file: the $4,350,000 is a gross fund, and the 30% cap in the fee request covers attorneys' fees only — litigation expenses sit on top of it, and notice, administration and tax costs are deducted separately again. Claims close December 16, 2026. The objection deadline has already passed (November 2, 2026) and the Settlement Hearing is November 16, 2026, so nothing is paid before then.

Do I Qualify?

You may be eligible if:

• You held or owned National Holdings Corporation common stock at some point between February 9, 2021 and the February 25, 2021 closing of the Merger. Record holders and beneficial owners both count
• AND your shares were exchanged for $3.25 in cash per share in the Merger tender offer. This second half of the test is where people fall out — holding the stock during the window is not enough by itself
• Your holding is large enough to clear the $10.00 minimum. Paragraph 35 makes no distribution to a Claimant who would otherwise receive less than $10.00. On the Notice's own per-share estimates that implies roughly two dozen cashed-out shares as a practical floor
• You held in street name at a brokerage. Beneficial owners are Class Members in their own right and file their own Proof of Claim — your broker does not file it for you
• You are an estate, trust, heir, executor, successor, assign or transferee of a qualifying holder. Paragraph 21 expressly includes these parties, so a deceased holder's estate can claim
• You can state the number of shares cashed out and supply a Social Security number or Taxpayer Identification Number. The SSN or TIN is a required field on the Proof of Claim
• You file a valid Proof of Claim and Release, postmarked or submitted online, by December 16, 2026. Filing is the only way to be paid — there is no automatic distribution
• It does NOT matter what state or country you live in. There is no residency test, and no connection to Delaware is needed
• WHO DOES NOT QUALIFY: anyone who bought National Holdings stock after the February 25, 2021 closing, and anyone who sold their shares on the open market before that closing so that nothing was exchanged at $3.25 in the tender offer
• ALSO DOES NOT QUALIFY IN PRACTICE: holders of only a few shares. Eligibility and payment are different questions, and the $10.00 floor resolves the second one against very small holdings
• EXCLUDED BY THE CLASS DEFINITION: Defendant Michael Mullen, B. Riley Financial, Inc. (BRF), Bryant Riley, their immediate family members, any entity in which they held a controlling interest, and successors-in-interest to those parties
• NOTE THAT YOU CANNOT OPT OUT. This is a non-opt-out class under Rules 23(a), 23(b)(1) and 23(b)(2). Even a Class Member who never files is bound by the judgment and the releases

This is a brokerage-records settlement, and the form is softer about documentation than it is about everything else. Two fields are hard requirements and one is hedged, so read the difference carefully. Your share count is required. Item A of the Proof of Claim asks for the number of shares of National common stock you held which were cashed out in connection with the Merger. Distribution is pro rata with stock holdings, so this number is the whole of your claim. Your Social Security number or Taxpayer Identification Number is required. The form provides a Social Security number field for individuals and a Taxpayer Identification Number field for estates, trusts and corporations. There is no way around this one. Documentation is requested “if readily available” — but do not read that as optional. The form asks you to provide copies of broker confirmations or other documentation, such as trade confirmations or screen shots, of your holdings, and the signed warranty on page 3 says you have included information about your share count including supporting documentation if readily available. The very next sentence of the instructions is the one that matters: failure to provide this documentation could delay verification of your claim or result in rejection of your claim. The administrator is verifying a five-year-old holding against whatever you hand over. Treat the records as effectively necessary and send everything you have. The account may well be closed by now. The holding dates to February 2021, and the instructions themselves suggest requesting copies from your broker because those documents help prove and expedite processing. A brokerage can usually produce historical statements for a closed account on request, and that is the single most useful thing to chase before the December 16, 2026 deadline. The signature carries a release and a declaration. Signing page 3 is your acknowledgment of the release described in the form, under a declaration that the information supplied is true and correct, and it includes a warranty that you have not assigned or transferred the claim. Two mechanical notes from the instructions: do not send originals of stock certificates or other documentation, because they will not be returned, and do not use red pen or highlighter on the form or the supporting documents.

What Happened?

B. Riley Financial, Inc. acquired National Holdings Corporation through a tender offer that closed on February 25, 2021, cashing out National's public stockholders at $3.25 a share. National had been a Delaware corporation operating as a broker-dealer and investment banking firm.

The Frank Trust, as plaintiff, sued Michael Mullen, a former officer of National Holdings, in the Court of Chancery of the State of Delaware. The case is Nancy Frank, as Trustee of The Frank Trust, et al. v. Michael Mullen, Lead C.A. No. 2023-0381-MTZ. The plaintiff alleged that Mullen breached his fiduciary duties by negotiating a side arrangement with B. Riley that favored management's rollover equity without the oversight that would have protected minority stockholders, and by withholding valuation information from the board and its special committee. The plaintiff sought compensatory and quasi-appraisal damages.

Mullen denies all of it. The Notice records that he denies any wrongdoing, denies that any public disclosure concerning the Merger was deficient, denies that the process by which the Merger was negotiated was insufficient, denies that the Merger Consideration was insufficient, and maintains that he acted in accordance with his fiduciary duties at all times. He agreed to settle solely to eliminate the burden, expense, risk and distraction of further litigation and trial. The Court has made no findings on the merits, and class certification is for settlement purposes only.

B. Riley Financial was dismissed from the case in May 2025. The settlement money is coming from Mullen, an individual former officer, rather than from National Holdings or from the acquirer. This matters for expectations: the fund is $4,350,000 against a class that held 7,242,674 shares.

The parties mediated a second time in April 2026, executed a Memorandum of Understanding on April 30, 2026, and signed the binding Stipulation of Settlement, Compromise and Release on June 10, 2026 for $4,350,000.00 in cash. The Court then authorized notice to the Class and the claim period opened.

RG/2 Claims Administration LLC is the Settlement Administrator, reachable at P.O. Box 59479, Philadelphia, PA 19102-9479, toll free at 1-866-742-4955, and at info@rg2claims.com. Co-Lead Counsel for the Class includes Monteverde & Associates PC. Brokers and other nominees holding National stock for customers were directed either to forward the Notice to those beneficial owners or to send the administrator a list of their names and addresses within seven days.

The claim deadline is December 16, 2026. The deadline to object to the Settlement, the Plan of Allocation or the fee request, and to request to speak at the hearing, was November 2, 2026. The Settlement Hearing is set for November 16, 2026 at 11:00 a.m., either in person at the Leonard L. Williams Justice Center, 500 North King Street, Wilmington, Delaware 19801, or remotely by Zoom at the Court's discretion. No final approval has been granted and no payment date has been announced.

One carve-out in the release is worth flagging for anyone who took a different route in 2021: the Released Plaintiff's Claims expressly do not bar a Class Member from pursuing any properly perfected claim for appraisal under 8 Del. C. section 262. A stockholder who perfected appraisal rights keeps that claim.

How to File Your Claim

1. CONFIRM THE TWO-PART TEST FIRST. You must have held National Holdings common stock at some point between February 9 and February 25, 2021 AND have had those shares exchanged for $3.25 in cash in the tender offer that closed February 25, 2021. Shares you sold on the open market before that closing were not exchanged in the Merger and do not count
2. FILE ONLINE at the official administrator page, www.rg2claims.com/national.html, run by RG/2 Claims Administration LLC. The Proof of Claim and Release can be submitted there or downloaded from the same page. This is the page named in paragraphs 29 and 32 of the court-approved Notice
3. PREFER PAPER? Download the Proof of Claim and Release from that page, complete it, sign page 3, and mail it to RG/2 Claims Administration LLC, P.O. Box 59479, Philadelphia, PA 19102-9479. It must be postmarked, or received if filed online, no later than December 16, 2026
4. STATE YOUR SHARE COUNT. Item A of the form asks for the number of shares of National common stock you held that were cashed out in connection with the Merger. That single number drives your entire payment, because distribution is pro rata with stock holdings
5. SUPPLY YOUR SOCIAL SECURITY NUMBER OR TAXPAYER ID. The form requires a Social Security number for individuals, or a Taxpayer Identification Number for estates, trusts and corporations. This is a hard field on the form, not an optional one
6. ATTACH YOUR BROKERAGE RECORDS. The form asks for copies of broker confirmations or other documentation, such as trade confirmations or screen shots, of your holdings, and it asks for them if readily available rather than as an absolute precondition. Read that softness carefully: the form itself warns that failure to provide this documentation could delay verification of your claim or result in rejection of your claim. Send whatever you have
7. ACCOUNT SINCE CLOSED? The holding dates back to February 2021 and many brokerage accounts have been closed since. Request historical statements from the brokerage
8. the form expressly suggests requesting copies from your broker because those documents help prove and expedite the claim
9. SIGN THE RELEASE. Your signature on page 3 is your acknowledgment of the release, and the form is signed under a declaration that the information supplied is true and correct. Do not send original stock certificates, and do not use red pen or highlighter on the form or the attachments
10. WATCH THE EARLIER DATE. Claims close December 16, 2026, but objections and requests to speak at the hearing were due by November 2, 2026, and the Settlement Hearing is set for November 16, 2026
11. QUESTIONS? Contact RG/2 Claims Administration LLC toll free at 1-866-742-4955, by fax at (215) 827-5551, by email at info@rg2claims.com, or by mail at P.O. Box 59479, Philadelphia, PA 19102-9479
12. Visit the official claim form: https://www.rg2claims.com/national.html

How Much Will I Actually Get?

ONE BENEFIT, ONE PATH. There is no election to make on this form and nothing to trade away. Every Authorized Claimant receives the same single thing: a pro rata share of the Net Settlement Fund, in proportion to the number of National shares that were cashed out at $3.25 in the Merger. Paragraph 33 is explicit that only Class Members who submit a valid Proof of Claim may share in the recovery, pro rata with their stock holdings. There is no flat payment, no tiered option and no non-cash benefit. THE $10 FLOOR IS THE MOST IMPORTANT NUMBER ON THIS PAGE. Paragraph 35 provides that no distributions will be made to Claimants who would otherwise receive a distribution of less than $10.00. There is no partial payment and no rounding up below that line. Work the arithmetic before you spend an afternoon chasing 2021 brokerage statements. The Notice's own figures are an average of about $0.60 per share before fees and expenses it estimates at about $0.18 per share, which leaves roughly $0.42 per share, and notice and administration costs come out on top of that. On those numbers a holder needs on the order of two dozen cashed-out shares to clear $10.00 at all. That is our arithmetic from the Notice's estimates, not a share threshold published by the Court or the administrator, and the real figure moves with the claim rate and with what the Court awards. The direction of the point is not in doubt, though: a few shares of National Holdings will very likely pay nothing. $4,350,000 IS THE GROSS FUND, NOT THE PAYOUT POOL, AND NO SINGLE CAP COVERS THE DEDUCTIONS. Paragraph 30 defines the Net Settlement Fund as the Settlement Amount plus interest, less four separate things: any Taxes and Tax Expenses, any Notice and Administration Costs, any Fee and Expense Award awarded by the Court, and any other costs or fees approved by the Court. Paragraph 40 then describes the fee request as up to 30% of the Settlement Fund PLUS EXPENSES, including an incentive award of up to $10,000 for the Plaintiff paid out of that fee award. Read the two paragraphs together: the 30% ceiling governs the attorneys' fee component only. Litigation expenses sit outside it, and notice, administration and tax costs are deducted separately again. Anyone who assumes 30% is the worst case for the whole fund is reading a cap that does not cover the whole fund. The Notice's own blended estimate of roughly $0.18 per share for Court-approved fees and expenses is about 30% of the $0.60 per-share average, and it still excludes notice and administration costs by its own terms. Class Members are not personally liable for any of these fees. FEWER CLAIMS MEANS MORE PER SHARE. The $0.60 average in paragraph 35 assumes that all 7,242,674 shares held by the Class as of February 9, 2021 participate. The Notice states plainly that historically less than all eligible investors submit claims, resulting in higher average distributions per share. Your actual recovery is your claim measured against the total claims of all eligible Class Members who file acceptable Proofs of Claim, so it can come in above or below the average. THE PLAN OF ALLOCATION CAN STILL CHANGE. Paragraphs 32 and 34 allow the Court to approve the proposed Plan of Allocation or to modify it without additional notice to the Class, with any modifying order posted on the administrator's page. Approval of the Settlement is independent of approval of a Plan of Allocation. NOTHING IS PAID YET. No money is available now and no payment date has been announced. Paragraph 31 bars distribution until the Court has approved both the Settlement and a Plan of Allocation and the time for any petition for rehearing, appeal or review has expired. The Settlement Hearing is November 16, 2026 at 11:00 a.m., and an appeal would push payment well past that.

Last reviewed: October 2, 2026 | Information verified from court records and official settlement documents.

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