ALJ Regional Holdings, Inc. (NASDAQ:ALJJ) Files An 8-K Entry into a Material Definitive Agreement

ITEM 1.01. Entry into a Material Definitive Agreement.

Financing Agreement Amendment

On May 26, 2017, ALJ Regional Holdings, Inc. (the Company)
entered into the Second Amendment (the Second Amendment) to the
Financing Agreement, dated as of August 14, 2015 (as amended and
restated from time to time, the Financing Agreement), by and
among the Company, Faneuil, Inc. (Faneuil), Floors-N-More, LLC,
Phoenix Color Corp., each subsidiary of the Company listed as a
Guarantor on the pages thereto, the lenders from time to time
party thereto, Cerberus Business Finance, LLC, as collateral
agent for the lenders (the Collateral Agent), and PNC Bank,
National Association, as administrative agent for the lenders
(the Administrative Agent). The Second Amendment updated certain
definitions, representations and warranties and covenants to
allow for the acquisition of certain assets and the assumption of
certain liabilities of the business process outsourcing and
contact center operations business (the Contact Center Operations
Business and such acquisition, the Acquisition) from Vertex
Business Services LLC (Vertex).

The use of proceeds are restricted to (i) fund up to $8.1 million
of the purchase price for the Contact Center Operations Business,
(ii) pay up to $3.0 million for capital expenditures in
connection with the Acquisition, (iii) fund general corporate and
working capital purposes of Company or any of its subsidiaries,
and (iv) pay fees and expenses related to the Second Amendment.

The foregoing description of the Second Amendment is only a
summary, does not purport to be complete, and is qualified in its
entirety by reference to the full text of the Second Amendment,
which is filed as Exhibit 10.1 hereto, the First Amendment to the
Financing Agreement, which was filed as Exhibit 10.1 to the
Companys Current Report on Form 8-K, previously filed with the
Commission on July 20, 2016, and the Financing Agreement, which
was filed as Exhibit 10.1 to the Companys Registration Statement
on Form 10-12B/A, previously filed with the Commission on March
28, 2016.

Registration Rights Agreement

On May 26, 2017, in connection with the Acquisition, the Company
entered into a Registration Rights Agreement (RRA) with Vertex,
which obligates ALJ to effect a registration statement (Shelf
Registration Statement) to Rule 415 of the Securities Act of
1933, as amended (the Securities Act), covering all shares of
ALJs common stock issued to Vertex. to the RRA, ALJ must (i) file
the Shelf Registration Statement within thirty calendar days
(excluding any days which occur during a permitted blackout
period, as defined in the RRA) after receipt of a written request
by Vertex for a Shelf Registration, (ii) use commercially
reasonable efforts to cause the Shelf Registration Statement to
be declared effective under the Securities Act, and (iii) use its
reasonable best efforts to keep the Shelf Registration Statement
continuously effective under the Securities Act until all of the
shares covered by the RRA have been sold.

The foregoing description of the RRA is only a summary, does not
purport to be complete, and is qualified in its entirety by
reference to the full text of the RRA, which is filed as Exhibit
10.2 hereto.

ITEM 2.01. Completion of Acquisition or Disposition of Assets.

On May 26, 2017, Faneuil, a wholly-owned subsidiary of the
Company, consummated and closed the Acquisition to the Asset
Purchase Agreement dated May 15, 2017 (the Purchase Agreement) by
and among Faneuil, Vertex and the Company (solely with respect to
certain sections of the Purchase Agreement).The Contact Center
Operations Business provided call center and speech analytics
services for the customer management outsourcing (CMO) division
of Vertex with operations in Kennesaw, Georgia, St. Louis,
Missouri, Scottsbluff, Nebraska and Richardson, Texas.

As consideration for the Transaction, Faneuil paid (i) $8,036,745
in cash consideration, reflecting a net working capital
adjustments at closing, and (ii) 1,466,667 shares of the Companys
common stock in stock consideration, valued using the thirty-day
weighted-average closing price of $3.32 per share.Faneuil will
place 391,566 shares of the Companys common stock issued as stock
consideration in an escrow account at closing to secure any
Vertex obligation to indemnify Faneuil for breaches by Vertex of
its representations and warranties and covenants under the
Purchase Agreement, or potentially in the event of any working
capital adjustment in favor of Faneuil.

The foregoing description of the Purchase Agreement is only a
summary, does not purport to be complete and is qualified in its
entirety by reference to the full text of the Purchase Agreement,
which is filed as Exhibit 2.1 hereto.

ITEM 2.03. Creation of a Direct Financial Obligation or an
Obligation Under an Off-Balance Sheet Arrangement of a
Registrant.

The discussion in Item 1.01 with respect to the Second Amendment
is incorporated herein by reference.

ITEM 7.01. Regulation FD Disclosure.

On May 26, 2017, Faneuil and the Company issued a news release
announcing the consummation and closing of the Acquisition. The
full text of the news release is furnished as Exhibit 99.1 and
incorporated in its entirety herein by reference.

The information under this Item 7.01 of this Current Report on
Form 8-K and Exhibit 99.1 hereto shall be deemed furnished and
not filed for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended, and shall not be incorporated by
reference into any registration statement of the issuer, except
as shall be expressly set forth by specific reference in such
filing.

ITEM 9.01. Financial Statements and Exhibits.

(d) Exhibits

About ALJ Regional Holdings, Inc. (NASDAQ:ALJJ)

ALJ Regional Holdings, Inc. is a holding company. The Company’s segments include Faneuil, Carpets and Phoenix. The Faneuil segment offers clients customer relationship management; billing, payment and claims processing; data entry; document management; workforce and support analytics; quality assurance; system support and maintenance, and staffing services. The Carpets segment is a provider of multiple products for the commercial, retail and home builder markets, including all types of flooring, countertops, cabinets, window coverings and garage/closet organizers. The Carpets segment provides various floor coverings to commercial and retail customers, including carpet, ceramic, porcelain, natural stone, vinyl plank, vinyl tile, area rugs and specialty flooring, including bamboo, leather, cork and large format tile. The Phoenix segment is engaged in offering digital pre-press capabilities and its ultraviolet (UV) printing platform supports a range of printing and finishing options.

ALJ Regional Holdings, Inc. (NASDAQ:ALJJ) Recent Trading Information

ALJ Regional Holdings, Inc. (NASDAQ:ALJJ) closed its last trading session down -0.01 at 3.20 with 36,983 shares trading hands.