Item
1.01 Entry into a Material Definitive Agreement.
On November 21, 2017,
Ladenburg Thalmann Financial Services Inc. (the “Company”) entered into an indenture and
a first supplemental indenture, each dated as of November 21, 2017 (the “Base Indenture” and “Supplemental
Indenture,” respectively, and together, the “Indenture”), between the Company and U.S. Bank National Association,
as trustee (the “Trustee”) in connection with the Company’s previously disclosed offering of $72,500,000 aggregate
principal amount of its 6.50% Senior Notes due 2027 (the “Firm Notes”), plus an additional $10,875,000 aggregate
principal amount of 6.50% Senior Notes due 2027 to cover underwriter overallotments, if any (the “Additional Notes”
and together with the Firm Notes, the “Notes”), pursuant to an Underwriting Agreement, dated as of November 14, 2017
(the “Underwriting Agreement”), between the Company and Ladenburg Thalmann & Co. Inc., as representative of the
underwriters named in Schedule A thereto (the “Underwriters”).
The Notes are senior
unsecured obligations of the Company and rank equally in right of payment with all of the Company’s existing and future
senior unsecured and unsubordinated indebtedness. The Notes are effectively subordinated in right of payment to all of
the Company’s existing and future secured indebtedness and structurally subordinated to all existing and future indebtedness
of the Company’s subsidiaries. The Notes bear interest at the rate of 6.50% per annum, payable quarterly in arrears on March
31, June 30, September 30 and December 31 of each year, commencing on December 31, 2017, and at maturity. The Notes mature
on November 30, 2027.
The
Company may, at its option, at any time and from time to time, on or after November 30, 2020, redeem the Notes, in whole or in
part, at a redemption price equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest to, but
excluding, the date fixed for redemption. On and after any redemption date, interest will cease to accrue on the redeemed Notes.
The
Indenture provides for the form of, and terms of, the Notes as described herein and the issuance of the Notes as
a new series of securities of the Company. The Indenture contains customary events of default and cure provisions. If an uncured
default occurs and is continuing, the Trustee or the holders of at least 25% of the outstanding principal amount of the Notes
may declare the entire principal amount of the Notes, together with accrued and unpaid interest, if any, to be due and payable
immediately by a notice in writing to the Company and, if notice is given by the holders of the Notes, the Trustee. In the case
of an event of default involving the Company’s bankruptcy, insolvency or reorganization, the principal amount of the Notes,
together with accrued and unpaid interest, if any, will automatically, and without any declaration or other action on the part
of the Trustee or the holders of the Notes, become immediately due and payable.
The foregoing descriptions
of the Base Indenture, Supplemental Indenture and the Notes do not purport to be complete and are qualified in their entirety
by reference to the full text of the Base Indenture, Supplemental Indenture and the form of Note, copies of which are attached
to this Current Report on Form 8-K as Exhibits 4.1, 4.2 and 4.3, respectively, and incorporated herein by reference and
into the Company’s prospectus supplement and accompanying base prospectus relating to the offering of Notes (together, the
“Prospectus”), which forms a part of its Registration Statement on Form S-3 (Registration No. 333-216733).
On
November 21, 2017, the Company completed the sale of the Firm Notes. The sale of the Firm Notes resulted in net proceeds of approximately
$69,600,000 after deducting underwriting discounts and commissions, but before expenses. The Company plans to use the net proceeds
from the offering for general corporate purposes.
Attached
as Exhibit 5.1 to this Current Report on Form 8-K and incorporated herein by reference is a copy of the opinion of Holland &
Knight LLP relating to the validity of the Notes (the “Legal Opinion”). The Legal Opinion is also filed with reference
to, and is hereby incorporated by reference into, the Prospectus.