Star Equity (NASDAQ: STRR) plans $38.4M Harte Hanks acquisition with cash and preferred stock
Rhea-AI Filing Summary
Star Equity Holdings, Inc. entered into a definitive Merger Agreement to acquire Harte Hanks, Inc. via a merger of a Star subsidiary into Harte Hanks, which will become a wholly owned subsidiary and continue operating under the Harte Hanks brand within Star’s Business Services division. Each Harte Hanks common share will be converted into $5.00 per share in consideration, consisting of cash, Star 10% Series A Cumulative Perpetual Preferred Stock, or a combination, subject to an overall cash cap.
The transaction values Harte Hanks at approximately $38.4 million of equity based on about 7.68 million fully diluted shares. Up to $19.2 million (roughly 50% of consideration) may be paid in cash, with the balance in Star preferred stock; no Star common stock will be issued. The combined company is presented with FY 2025 pro forma revenue of about $384 million and pro forma adjusted EBITDA of about $30 million after an estimated $10 million of annual run-rate cost synergies, largely from eliminating duplicative public-company and corporate overhead.
Closing is subject to Harte Hanks stockholder approval, effectiveness of a Form S-4 registering the Star preferred stock, required third-party consents, and completion of debt financing (including a draw of up to $15 million under Harte Hanks’ credit facility or alternative financing). Each party may owe a $1,152,000 termination fee in specified circumstances, and maximum liability for breaches is capped at the same amount. Star also highlights approximately $215 million of U.S. federal net operating losses as a benefit to the combined company, and states the preferred-stock structure is intended to avoid an ownership change under Section 382.
Positive
- Strategic BPO scale-up with quantified synergies: the combined company is projected to have about $384 million FY 2025 pro forma revenue and roughly $30 million pro forma adjusted EBITDA after $10 million in annual run-rate cost synergies, enhancing the Business Services platform.
- Balanced, non-dilutive equity structure: consideration is capped at about $19.2 million in cash with the balance in 10% preferred stock, and the company states no common shares will be issued in the Merger, helping preserve existing common equity.
- Significant tax asset support: Star highlights approximately $215 million of U.S. federal net operating losses, which it expects the combined company to benefit from without triggering an ownership change under Section 382 due to using preferred rather than common stock.
Negative
- Execution and financing risk: closing depends on Harte Hanks stockholder approval, effectiveness of a Form S-4, required consents, and completing up to $15 million in debt financing or alternatives, any of which could delay or prevent the Merger.
- Integration and synergy realization risk: the company identifies uncertainty around successfully operating as a combined business and achieving approximately $10 million of anticipated annual cost synergies and other expected Merger benefits.
Filing Explained
At signing, qualifying vested Harte Hanks awards receive merger consideration, while performance units and certain unvested awards receive none.
The
For vested options, the payment is based on the excess of the merger consideration over the option’s exercise price; options that are unvested or have an exercise price of at least
Separately, Harte Hanks directors and certain officers, acting as stockholders, agreed to vote their shares for the merger and against specified alternative transactions. Those support agreements also impose pre-closing lock-up restrictions and end upon the earliest of specified termination events, including closing or valid termination of the merger agreement.
8-K Event Classification
3 items: 1.01, 7.01, 9.01
3 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Merger price per Harte Hanks share: $5.00 per share
Implied Harte Hanks equity value: $38.4 million
Maximum cash consideration: $19.2 million
+5 more
8 metrics
Merger price per Harte Hanks share
$5.00 per share
Consideration for each share of Harte Hanks common stock in the Merger
Implied Harte Hanks equity value
$38.4 million
Based on approximately 7.68 million fully diluted Harte Hanks shares
Maximum cash consideration
$19.2 million
Aggregate cash cap for Merger consideration including cash in lieu of fractional preferred
Pro forma FY 2025 revenue
$384 million
Combined Star–Harte Hanks FY 2025 pro forma annual revenues
Pro forma adjusted EBITDA post-synergies
$29.523 million
Combined adjusted EBITDA including $10 million estimated annual run-rate synergies
Estimated annual cost synergies
$10 million
Annualized run-rate savings from duplicative public-company and corporate costs
U.S. federal NOLs
$215 million
Star’s usable net operating losses as of December 31, 2025
Termination fee per party
$1,152,000
Termination fee or liability cap for each of Star and Harte Hanks under specified conditions
Key Terms
go-shop period, Form S-4, termination fee, net operating losses, +2 more
6 terms
go-shop period financial
"the merger agreement also provides for a 30-day go-shop period"
A go‑shop period is a short, agreed window after a sale agreement where the company being acquired can actively seek better offers from other buyers. Think of it as a limited auction allowed after a handshake; it can drive up the final sale price, change the likelihood a deal closes, and alter the risk that the originally announced buyer will be replaced or pay a breakup fee, so investors watch it for potential value or uncertainty.
Form S-4 regulatory
"Star intends to file a Registration Statement on Form S-4 with the SEC"
A Form S-4 is a legal document that companies file with the government to announce and explain a major business move, such as a merger or acquisition. It provides detailed information to help investors understand how the deal might affect the company's value and future prospects, similar to a detailed blueprint that clarifies the impact of a significant change.
termination fee financial
"HH may be required to pay Star a termination fee equal to $1,152,000"
A termination fee is a payment required if one party ends a contract before its agreed-upon end date. It acts like a penalty or compensation to the other party for canceling early, similar to a fee you might pay for breaking a lease or canceling a service contract. For investors, it matters because it can influence a company's decisions and financial obligations related to ending agreements prematurely.
net operating losses financial
"The combined company will benefit from Star's $215 million U.S. Federal net operating losses"
Net operating losses are the amount by which a company’s allowable tax deductions exceed its taxable income in a given year, creating a tax loss that can be carried forward or backward to reduce taxes in other years. For investors this matters because NOLs can lower future tax payments and boost cash flow—think of them as unused tax credits a business can apply later to improve profitability and valuation or make the company more attractive in a sale or investment.
Business Process Outsourcing financial
"creating a multi-BPO platform serving clients across talent solutions, customer care"
Business process outsourcing is when a company hires an outside firm to perform routine operational tasks—such as payroll, customer support, IT operations, or back-office administration—so the company can focus on its core products or services. Investors care because outsourcing often lowers costs, improves scalability and flexibility, and shifts operational risks; changes in a company’s outsourcing strategy can therefore affect profit margins, growth prospects and regulatory or service-quality risks.
cumulative perpetual preferred stock financial
"10% Series A Cumulative Perpetual Preferred Stock, par value $0.001 per share"
A cumulative perpetual preferred stock is a share that acts like a long-lasting hybrid between a bond and a dividend-paying stock: it promises regular fixed payments that, if missed, accumulate and must be paid later before common shareholders get dividends, and it has no set maturity date. Investors care because it can provide steady, higher-priority income similar to interest, but with limited capital upside, sensitivity to interest rates, and the risk that payments can be delayed even though they continue to accrue.
FAQ
What are the key terms of Star Equity (STRR) acquiring Harte Hanks?
Star Equity agreed to acquire Harte Hanks for $5.00 per share, valuing the equity at about $38.4 million. Consideration will be a mix of cash and Star’s 10% Series A preferred stock, with aggregate cash payments capped at approximately $19.2 million.
How will Harte Hanks stockholders in the STRR Merger be paid?
Each Harte Hanks share will receive $5.00 per share in value, through cash, Star preferred stock, or a combination. Stockholders can elect form of consideration, but total cash is capped at about $19.2 million, with preferred stock elections uncapped and no Star common stock issued.
What financial profile is projected for Star Equity (STRR) after the Harte Hanks Merger?
The combined company is presented with FY 2025 pro forma revenue of roughly $384 million and pro forma adjusted EBITDA of about $30 million. This EBITDA figure includes an estimated $10 million in annual run-rate cost synergies from eliminating duplicative costs.
How is the STRR–Harte Hanks Merger financed and what debt is involved?
The cash portion, up to about $19.2 million, is expected to be funded with cash on hand and debt. The parties reference a potential drawdown of up to $15 million under Harte Hanks’ existing $25 million credit facility or alternative acceptable debt financing.
What tax benefits does Star Equity (STRR) expect from the Harte Hanks transaction?
Star reports approximately $215 million of U.S. federal net operating losses as of December 31, 2025. It states that using preferred stock as Merger consideration is not expected to cause an ownership change under Section 382, helping preserve these NOLs for the combined company.
What conditions must be met before the Star Equity (STRR) and Harte Hanks Merger can close?
Closing requires approval of the Merger by Harte Hanks stockholders, effectiveness of a Form S-4 registering the Star preferred stock, receipt of certain third-party consents, and completion of required debt financing, along with customary accuracy and covenant-performance conditions.
Are there termination fees in the Star Equity (STRR) and Harte Hanks Merger Agreement?
Yes. Under specified circumstances, Harte Hanks may owe Star a termination fee of $1,152,000, and Star may owe Harte Hanks the same amount. Each party’s maximum liability for breaches is also capped at $1,152,000, subject to limited exceptions.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 14, 2026
(Exact name of registrant as specified in charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of Principal Executive Offices)
Registrant's telephone number, including area code (203 ) 489-9500
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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 13(a) of the Exchange Act. ☐
| Item 1.01. | Entry into a Material Definitive Agreement. | ||||
Merger Agreement
On August 14, 2026, Star Equity Holdings, Inc., a Delaware corporation (“Star”), Merger Sub – R, Inc., a Delaware corporation and a wholly owned subsidiary of Star (“Merger Sub”), and Harte Hanks, Inc., a Delaware corporation (“HH”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which, among other matters, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Merger Sub will merge with and into HH, with HH continuing as the surviving corporation of the merger (the “Merger”), and a wholly owned subsidiary of Star.
Subject to the terms and conditions of the Merger Agreement, upon the closing of the Merger and the other transactions contemplated by the Merger Agreement (the “Closing”), (a) any shares of HH common stock held as treasury stock, or held directly by Star or Merger Sub (or any of their respective subsidiaries) will be canceled, retired and cease to exist, and no consideration will be delivered in exchange therefor, and (b) each then-outstanding share of HH common stock (other than the shares described in the foregoing subclause (a)) will be converted into the right to receive, without interest and subject to adjustment as set forth in the Merger Agreement: (1) if, with respect to such share, an election to receive cash has been properly made and not revoked or lost pursuant to the terms of the Merger Agreement (each such share, a “Cash Electing Share”), cash in an amount equal to $5.00 per share (the “Cash Consideration”), (2) if, with respect to such share, an election to receive shares of the 10% Series A Cumulative Perpetual Preferred Stock, par value $0.001 per share, of Parent (“Parent Preferred Stock”) has been made and not lost (each such share, a “Preferred Stock Electing Share”), the right to receive 0.50 shares of Parent Preferred Stock (the “Preferred Stock Consideration” and, together with the Cash Consideration, and any combination thereof, and any cash in lieu of fractional shares of Parent Preferred Stock, collectively, the “Merger Consideration”), and (3) if such share is neither a Cash Electing Share or a Preferred Stock Electing Share (each, a “Non-Electing Share”), then, the Cash Consideration, the Preferred Stock Consideration or a combination of both.
In addition, (a) each outstanding, vested option to purchase shares of HH common stock (each, a “Vested Company Option”) will be cancelled, treated as a Cash-Electing Share, Preferred Stock Electing Share, or Non-Electing Share, as per the election (or non-election) made by the holder of such Vested Company Option and converted automatically into the right to receive Cash Consideration, Preferred Stock Consideration, or a combination of the two in an amount equal to the product of (i) the excess, if any, of the Merger Consideration over the per share exercise price of such Vested Company Option, multiplied by (ii) the number of shares of HH common stock covered by such Vested Company Option (for the avoidance of doubt, any outstanding option to purchase shares of HH common stock that is either unvested or has a per share exercise price equal to or greater than the per-share Merger Consideration will be cancelled without payment or consideration), and (b) each outstanding HH restricted stock unit that vests in connection with the consummation of the Merger (each, a “Vested Company RSU”) will be cancelled, treated as a Cash-Electing Share, Preferred Stock Electing Share, or Non-Electing Share, as per the election (or non-election) made by the holder of such Vested Company RSU, and converted into a right to receive Cash Consideration, Preferred Stock Consideration, or a combination of the two in an amount equal to the Merger Consideration for each share of HH common stock covered by such Vested Company RSU (for the avoidance of doubt, any HH restricted stock unit that does not vest upon consummation of the Merger shall be cancelled without payment or consideration). Each outstanding HH performance stock unit (each, a “Company PSU”) will be cancelled without payment or consideration.
Notwithstanding the foregoing, the aggregate amount of Cash Consideration, together with any cash payable in lieu of fractional shares of Parent Preferred Stock, shall not exceed $19,200,000 (the “Maximum Cash Amount”). The allocation of the Cash Consideration and the Preferred Stock Consideration among Cash Electing Shares, Preferred Stock Electing Shares and Non-Electing Shares will be determined as follows:
•If the aggregate amount of cash that would be paid in respect of all Cash Electing Shares is less than the Maximum Cash Amount, then: each Cash Electing Share will be converted into the right to receive the Cash Consideration; each Preferred Stock Electing Share will be converted into the right to receive the Preferred Stock Consideration; and each Non-Electing Share will be converted into the right to receive, at Parent’s election, the Cash Consideration, the Preferred Stock Consideration or a combination of both (subject to the Maximum Cash Amount);
•If the aggregate amount of cash that would be paid in respect of all Cash Electing Shares exceeds the Maximum Cash Amount, then: each Preferred Stock Electing Share and each Non-Electing Share will be converted into the right to receive the Preferred Stock Consideration, and each Cash Electing Share will be converted into the right to receive (x) a prorated portion of the Cash Consideration, based on a fraction, the numerator of which is the Maximum Cash Amount and the denominator of which is the aggregate amount of cash that would be paid in respect of all Cash Electing Shares if all such Cash Electing Shares received the Cash Consideration in full, and (y) the Preferred Stock Consideration in respect of the remaining portion of such Cash Electing Share not converted into the right to receive cash pursuant to clause (x); and
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•No fractional shares of Parent Preferred Stock will be issued in the Merger. In lieu of any fractional share of Parent Preferred Stock that otherwise would be issuable, the holder thereof will be entitled to receive an amount in cash, without interest, equal to such fractional share multiplied by $10.00.
In connection with the Merger, HH will hold a meeting of the holders of HH common stock (the “Stockholder Meeting”) to seek the approval of the adoption and approval of the Merger Agreement and the transactions contemplated thereby from its stockholders (the “Merger Proposal”), and to adjourn the Stockholder Meeting to solicit additional proxies if a quorum is not present or if there are not sufficient votes cast at the Stockholder Meeting to approve the Merger Proposal or to ensure that any supplemental or amended disclosure is timely provided to HH stockholders.
Star intends to file a Registration Statement on Form S-4 with the U.S. Securities and Exchange Commission (the “SEC”) in connection with the issuance of the Parent Preferred Stock in the Merger (the “Form S-4”). The Form S-4 will include a joint Proxy Statement/Prospectus to be sent to the stockholders of HH in connection with the Stockholder Meeting (as amended or supplemented from time to time, the “Proxy Statement/Prospectus”), as well as information as how to make the form of election for form of Merger Consideration.
Each of Star and HH has agreed to customary representations and warranties in the Merger Agreement for a transaction of this nature. In addition, each of Star and HH agreed to be bound by certain customary covenants for a transaction of this nature, including, among others, (1) covenants to file the Form S-4 (including the Proxy Statement/Prospectus which will form a part thereof) with the SEC, to cause the same to become effective, and to mail the Proxy Statement/Prospectus to HH’s stockholders, (2) with respect to HH’s obligations to hold the Stockholder Meeting to solicit the requisite approval of the Merger from its stockholders, (3) with respect to non-solicitation by HH of alternative acquisition proposals (except during a 30-day go-shop period), (4) with respect to HH’s operation and conduct of its business during the period between the date of signing the Merger Agreement and the Closing, (5) with respect to HH’s obligations to provide continuing indemnification in respect of HH’s directors and officers, and to maintain directors’ and officers’ liability insurance, (6) with respect to HH’s obligations regarding certain benefits and benefit plans and bonus arrangements applicable to HH employees, (7) with respect to HH’s obligations to cause the shares of HH common stock to be de-listed from Nasdaq and de-registered under the Exchange Act following the Closing, (8) with respect to Star’s and HH’s respective obligations concerning the procurement of debt financing (in an amount sufficient to enable Star to fund, together with its available cash, the Cash Consideration at Closing) pursuant to a drawdown on HH’s existing credit facility with Texas Capital Bank (“TCB”), with the drawdown not to exceed $15 million, or under alternative debt financing acceptable to Star (the “Debt Financing”), (9) with respect to Star’s and HH’s respective obligations to notify each other of any material changes in the accuracy of their representations and warranties and/or any non-compliance with their respective covenants, and (10) with respect to HH’s and Star’s respective obligations to notify the other of any stockholder litigation concerning the Merger and, solely with respect to HH, to permit Star to participate in the defense or settlement of any such litigation. Subject to certain customary exceptions for covenants that, pursuant to their terms, are to be performed in whole or in part following the Closing, the representations, warranties and covenants of the parties set forth in the Merger Agreement will terminate at the Closing.
Consummation of the Merger is subject to certain closing conditions, including, among other things, approval by HH stockholders of the Merger Proposal and the effectiveness of the Form S-4. Each party’s obligation to consummate the Merger is also subject to other specified conditions, including, among other things, regarding (1) the accuracy of the representations and warranties of the other party, and (2) the performance in all material respects by the other party of its obligations under the Merger Agreement required to be performed on or prior to the date of the Closing. Additionally, the consummation of the Merger is subject to the receipt of certain required third-party consents and the consummation of the Debt Financing, which will require the consent of, or an amendment from, TCB to the extent TCB is the lender.
The Merger Agreement contains certain termination rights of each of Star and HH. Upon termination of the Merger Agreement under specified circumstances, HH may be required to pay Star a termination fee equal to $1,152,000, and Star may be required to pay HH a termination fee of $1,152,000. Each of HH’s and Star’s maximum liability for breach of the Merger Agreement is subject to a cap, including a cap of $1,152,000 with respect to HH’s liability and $1,152,000 with respect to Star’s liability, subject to certain limited exceptions.
Support Agreements
Concurrently with the execution of the Merger Agreement, (i) each of the directors and certain officers of HH (solely in their respective capacities as HH stockholders) have entered into Voting and Support Agreements (collectively, “Support Agreements”) with Star and HH that provide, among other things, that such stockholder will vote all of their shares of HH capital stock (including any shares of HH capital stock acquired following the date thereof and prior to the Closing) in favor of the Merger Proposal and against (x) any action that would reasonably be expected impede or frustrate the Merger Proposal or result in a breach of the Merger Agreement or the Support Agreement or (y) any proposal for an alternative transaction or any definitive agreement in respect of an alternative transaction. The Support Agreements shall terminate upon the earlier of (i) the effective time of the Merger, (ii) the time the Merger Agreement is validly terminated, (iii) as adverse recommendation change by HH’s board in accordance with the Merger Agreement, (iv) certain amendments of the Merger Agreement without the
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consent of the applicable stockholder, or (v) the termination of the Support Agreement upon the mutual written agreement of Star, HH and the applicable stockholder. The Support Agreements contain customary lock-up restrictions binding on the applicable stockholder that will remain in effect during the period prior to the Closing.
The preceding summaries of the Merger Agreement and the Support Agreements do not purport to be complete and are qualified in their entirety by reference to the Merger Agreement and the form of Support Agreement, which are filed as Exhibits 2.1 and 10.1, respectively, to this Current Report on Form 8-K and which are incorporated herein by reference. The Merger Agreement has been attached as an exhibit to this Current Report on Form 8-K to provide investors and securityholders with information regarding its terms. It is not intended to provide any other factual information about Star or HH or to modify or supplement any factual disclosures about Star or HH in their respective public reports filed with the SEC. The Merger Agreement includes representations, warranties and covenants of Star, HH and Merger Sub made solely for the purpose of the Merger Agreement and solely for the benefit of the parties thereto in connection with the negotiated terms of the Merger Agreement. Investors should not rely on the representations, warranties and covenants in the Merger Agreement or any descriptions thereof as characterizations of the actual state of facts or conditions of Star, HH, or any of their respective affiliates. Moreover, certain of those representations and warranties may not be accurate or complete as of any specified date, may be subject to a contractual standard of materiality different from those generally applicable to SEC filings or may have been used for purposes of allocating risk among the parties to the Merger Agreement, rather than establishing matters of fact.
| Item 7.01. | Regulation FD Disclosure. | ||||
On August 14, 2026, Star issued a press release announcing the execution of the Merger Agreement. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference, except that the information contained on the websites referenced in the press release is not incorporated herein by reference.
Furnished as Exhibit 99.2 hereto and incorporated herein by reference is the investor presentation that will be used by Star in connection with the Merger.
The information in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Forward-Looking Statements
This Current Report on Form 8-K and the exhibits filed or furnished herewith contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, express or implied statements regarding the structure, timing and completion of the proposed Merger; expectations regarding the ownership structure of the combined company; the anticipated timing of Closing; the expected executive officers and directors of the combined company; the future operations of the combined company; the nature, strategy and focus of the combined company; the executive and board structure of the combined company; and other statements that are not historical fact. All statements other than statements of historical fact contained in this Current Report on Form 8-K are forward-looking statements. These forward-looking statements are made as of the date they were first issued, and were based on the then-current expectations, estimates, forecasts, and projections, as well as the beliefs and assumptions of management. There can be no assurance that future developments affecting Star, HH, or the proposed Merger will be those that have been anticipated.
Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Star’s control. Star’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to (i) the risk that the conditions to the closing of the proposed Merger are not satisfied, including the failure to obtain the requisite Debt Financing or to timely obtain stockholder approval for the Merger, if at all; (ii) uncertainties as to the timing of the consummation of the proposed Merger and the ability of each of Star and HH to consummate the proposed Merger; (iii) risks related to Star’s ability to manage its operating expenses and its expenses associated with the proposed Merger pending closing; (iv) risks related to the failure or delay in obtaining required approvals from any governmental or quasi-governmental entity necessary to consummate the proposed Merger; (v) risks related to the market price of the Parent Preferred Stock relative to the value suggested by the Merger Consideration; (vi) unexpected costs, charges or expenses resulting from the Merger; (vii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed Merger; (viii) risks related to the inability of the combined company to successfully operate as a combined business; and (ix) risks associated with the possible failure to realize certain anticipated benefits of the proposed Merger, including with respect to future financial and operating results, among others. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. These and other risks and uncertainties are more fully described in periodic filings with the SEC, including the factors described in the section titled “Risk Factors” in Star’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC, and in other filings that Star makes and will make with the SEC in connection
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with the proposed Merger, including the Proxy Statement/Prospectus described below under “Additional Information and Where to Find It.” You should not place undue reliance on these forward-looking statements, which are made only as of the date hereof or as of the dates indicated in the forward-looking statements. Star expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. This Current Report on Form 8-K does not purport to summarize all of the conditions, risks and other attributes of an investment in Star or HH.
Participants in the Solicitation
Star, HH, and their respective directors and certain of their executive officers and employees may be considered participants in the solicitation of proxies from HH’s stockholders with respect to the proposed Merger under the rules of the SEC. Information about the directors and executive officers of Star is set forth in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on April 30, 2026 and certain other documents filed by Star with the SEC, and in subsequent documents filed with the SEC. Information about HH’s directors and officers is available in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed by HH with the SEC on April 9, 2026, and in subsequent documents filed with the SEC. Additional information will be made available to you regarding the persons who may be deemed participants in the proxy solicitations and their direct and indirect interests (by security holdings or otherwise) in the Merger and related transactions in a registration statement on Form S-4 (the “Form S-4”) that will contain the Proxy Statement/Prospectus, and other relevant materials, each that will be filed with the SEC and disseminated to HH’s stockholders when they become available. Instructions on how to obtain free copies of this document and, when available, the Form S-4 and Proxy Statement/Prospectus, are set forth below in the section headed “Additional Information and Where to Find It”.
This Current Report on Form 8-K and the exhibits filed or furnished herewith relate to the proposed Merger involving Star and HH and may be deemed to be solicitation material with respect to HH’s stockholders in respect of the proposed Merger. In connection with the proposed Merger, Star will file the Form S-4 and Proxy Statement/Prospectus. This Current Report on Form 8-K is not a substitute for the Form S-4, the Proxy Statement/Prospectus or for any other document that Star or HH may file with the SEC and or that HH may send to its stockholders in connection with the proposed Merger. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF HH ARE URGED TO READ THE FORM S-4, THE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT STAR, HH, THE PROPOSED MERGER AND RELATED MATTERS.
No Offer or Solicitation
This Current Report on Form 8-K and the exhibits filed or furnished herewith do not constitute an offer to sell or the solicitation of an offer to buy any securities nor a solicitation of any vote or approval with respect to the proposed Merger or otherwise. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U S. Securities Act of 1933, as amended, and otherwise in accordance with applicable law.
Additional Information and Where to Find It
Investors and security holders will be able to obtain free copies of the Form S-4, the Proxy Statement/Prospectus and other documents filed by Star with the SEC through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed by Star with the SEC will also be available free of charge on Star’s website at https://www.starequity.com/. You may obtain free copies of this document as described above.
| Item 9.01. | Financial Statements and Exhibits. | ||||
(d) Exhibits
EXHIBIT INDEX
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| 2.1* | Agreement and Plan of Merger, dated as of August 14, 2026, by and among Star Equity Holdings, Inc., Merger Sub - R, Inc., and Harte Hanks, Inc. | ||||
| 10.1 | Form of Support Agreement | ||||
| 99.1 | Press Release, issued on August 14, 2026 | ||||
| 99.2 | Investor Presentation, dated August 14, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
| * | Exhibits and/or schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby undertakes to furnish supplementally copies of any of the omitted exhibits and schedules upon request by the SEC; provided, however, that the registrant may request confidential treatment pursuant to Rule 24b-2 under the Exchange Act for any exhibits or schedules so furnished. | ||||
5
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
| STAR EQUITY HOLDINGS, INC. (Registrant) | ||||||||
| By: | /s/ MATTHEW K. DIAMOND | |||||||
| Matthew K. Diamond | ||||||||
| Chief Accounting Officer | ||||||||
| Dated: | August 14, 2026 | |||||||
6
Exhibit 99.1
Star Equity Holdings Enters Into Merger Agreement to Acquire Harte Hanks
Transaction Expands Star’s Business Services Platform, Enhances Revenue Diversity, and is Expected to Drive Significant Cost Synergies and Earnings Accretion
Harte Hanks Stockholders to Receive $5.00 per Share, Consisting of Cash and Star Preferred Stock
Old Greenwich, CT – August 14th, 2026: Star Equity Holdings, Inc. (“Star”) (Nasdaq: STRR; STRRP), a diversified holding company, announced today that it has entered into a merger agreement (the “Merger Agreement”) to acquire Harte Hanks, Inc. (the “Merger”) (“Harte Hanks”) (Nasdaq: HHS), a global customer experience and business process outsourcing company (together with Star, the “Companies”). Following the effectiveness of the Merger, Harte Hanks will continue to operate under the Harte Hanks brand, and its operations are expected to be reported within Star’s Business Services division.
The terms of the Merger have been approved by the Boards of Directors of Star and Harte Hanks. Closing is subject to the affirmative vote of Harte Hanks stockholders at a special meeting to be held later this year, the effectiveness of a registration statement on Form S-4 registering the Star preferred stock to be issued as Merger consideration, and other closing conditions. The merger agreement also provides for a 30-day go-shop period during which Harte Hanks may solicit and evaluate alternative acquisition proposals, subject to Star’s customary matching rights and a customary termination fee payable by either party in specified circumstances.
Transaction Benefits
•Scale: Expands Star's current scale; the merged company will have FY 2025 pro-forma annual revenues of approximately $384 million and pro-forma adjusted EBITDA of approximately $30 million after estimated synergies of $10 million.
•Creates Diversified Business Process Outsourcing (“BPO”) Platform: Positions Harte Hanks alongside Star’s Hudson Talent Solutions business within Star’s Business Services division, creating a multi-BPO platform serving blue-chip clients across talent solutions, customer care, marketing, sales, and fulfillment & logistics.
•Synergies: Approximately $10 million of estimated annualized run-rate cost synergies anticipated, including duplicative public-company corporate overhead as well as back-office and operational consolidation.
•Greater Revenue Diversity: Adds a new business to Star’s holding company structure and broadens the combined company’s end-market and client mix.
•Balanced Consideration: Up to 50% of the aggregate consideration will be paid in cash, with the balance, which may exceed 50%, paid in Star 10% Series A Cumulative Perpetual Preferred Stock (“Star Preferred Stock”), (Nasdaq: STRRP). No Star common stock will be issued in the Merger.
•NOL Utilization: The combined company will benefit from Star's $215 million(1) U.S. Federal net operating losses (“NOL”).
•Financing Capacity: Increased ability to finance growth, including acquisitions, by leveraging the combined company’s larger scale, cash flow, and credit profile.
(1) NOL balance as of 12/31/2025.
Transaction Details
•The Merger values Harte Hanks at $5.00 per share of common stock, or approximately $38.4 million of equity value, based on approximately 7.68 million shares of Harte Hanks fully diluted common stock outstanding.
•Up to 50% of the aggregate Merger consideration (approximately $19.2 million) will be paid in cash, with the balance paid in Star Preferred Stock. Harte Hanks stockholders may elect to receive cash or Star Preferred Stock, subject to proration, with aggregate cash payments capped at the above amount and Star Preferred Stock elections uncapped.
•The cash portion of the consideration is expected to be funded with a mix of cash on hand and debt financing. Harte Hanks currently has in place a $25 million credit facility.
•Star will assume Harte Hanks' defined benefit pension plan assets and liabilities at closing.
•Pending Harte Hanks stockholder approval and the satisfaction of closing conditions, the Merger is anticipated to close before year end 2026.
Jeff Eberwein, CEO of Star, said, “We are excited to announce the signing of this merger agreement. Harte Hanks is a business we have followed for years, with a century-long heritage, blue-chip clients, and talented people. Our team has run this playbook before – bring a good operating business inside our holding company structure, remove duplicative public company and corporate costs, and let the operators focus on serving clients and growing the business. We believe that adding Harte Hanks to our Business Services division alongside Hudson Talent Solutions creates a scaled, diversified outsourcing platform, and that the cost savings and increased revenue diversity will generate considerable value to our shareholders over time.”
Mr. Eberwein continued, “Since Star converted to its holding company structure, our goal has been to acquire attractive businesses, either to complement our existing platforms or to establish new growth platforms. The merger with Harte Hanks does both. We intend to move quickly on integration, leveraging Hudson Talent Solutions’ back-office infrastructure to eliminate duplicative operating-company overhead, while Harte Hanks continues to operate under its own brand with its operating teams and client relationships intact from day one.”
Following the completion of the Merger, Star is expected to continue to report four segments: Building Solutions, Business Services, Energy Services, and Investments. The Merger is expected to have minimal impact on clients, employees, or the brand names of any of Harte Hanks’ operating businesses.
A Form 8-K related to the Merger agreement will be filed with the SEC. Interested parties can access this information by visiting the SEC website www.sec.gov or by visiting Star’s website www.starequity.com or Harte Hanks’ website www.hartehanks.com.
NOL Carryforward
As of December 31, 2025, Star had $215 million of usable NOLs in the U.S., which the Company considers to be a very valuable asset for its stockholders. In order to protect the value of the NOL for all stockholders, Star has a rights agreement and charter amendment in place that limit beneficial ownership of Star common stock to 4.99%. Stockholders who wish to own more than 4.99% of Star common stock, or who already own more than 4.99% of Star common stock and wish to buy more, may only acquire additional shares with the Board’s prior written approval. Because the equity portion of the Merger consideration consists of Star Preferred Stock rather than Star common stock, Star does not expect the Merger to result in an “ownership change” under Section 382 of the Internal Revenue Code or to limit the availability of its NOLs.
Advisors
Baker Hostetler LLP is serving as legal advisor to Star. Citizens Capital Markets & Advisory is serving as lead financial advisor and Oaklins DeSilva & Phillips is a financial advisor to Harte Hanks. Baker Botts LLP is serving as legal advisor to Harte Hanks.
About Harte Hanks, Inc.
Harte Hanks, Inc. is a leading global customer experience company whose mission is to partner with clients to provide them with CX strategy, data-driven analytics and actionable insights, combined with seamless program execution. Harte Hanks delivers marketing, customer care, sales, data, fulfillment and logistics solutions that help brands build stronger relationships with their customers.
About Star Equity Holdings, Inc.
Star Equity Holdings, Inc. is a diversified holding company with four divisions: Building Solutions, Business Services, Energy Services, and Investments.
Building Solutions
Our Building Solutions division operates in three businesses: (i) modular building manufacturing; (ii) structural wall panel and wood foundation manufacturing, including building supply distribution operations; and (iii) glue-laminated timber (glulam) column, beam, and truss manufacturing.
Business Services
Our Business Services division provides flexible and scalable recruitment process outsourcing and total talent solutions to a global list of clients through Hudson Talent Solutions, and, following the completion of the Merger, customer experience and business process outsourcing services through Harte Hanks.
Energy Services
Our Energy Services division engages in the rental, sale, and repair of downhole tools used in the oil and gas, geothermal, mining, and water-well industries.
Investments
Our Investments division manages and finances the Company’s real estate assets as well as its investment positions in private and public companies.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, express or implied statements regarding the structure, timing and completion of the proposed Merger; expectations regarding the ownership structure of the combined company; the anticipated timing of closing; the expected executive officers and directors of the combined company; the future operations of the combined company; the nature, strategy and focus of the combined company; the executive and board structure of the combined company; and other statements that are not historical fact. All statements other than statements of historical fact contained in this press release are forward-looking statements. These forward-looking statements are made as of the date they were first issued, and were based on the then-current expectations, estimates, forecasts, and projections, as well as the beliefs and assumptions of management. There can be no assurance that future developments affecting Star, Harte Hanks, or the proposed Merger will be those that have been anticipated.
Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Star’s control. Star’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to (i) the risk that the conditions to the closing of the proposed Merger are not satisfied, including the failure to timely obtain stockholder approval for the Merger, if at all; (ii) uncertainties as to the timing of the consummation of the proposed Merger and the ability of each of Star and Harte Hanks to consummate the proposed Merger; (iii) risks related to Star’s ability to manage its operating expenses and its expenses associated with the proposed Merger pending closing; (iv) risks related to the failure or delay in obtaining required approvals from any governmental or quasi-governmental entity necessary to consummate the proposed Merger; (v) risks related to the market price of the Star preferred stock relative to the value suggested by the merger consideration; (vi) unexpected costs, charges or expenses resulting from the Merger; (vii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed Merger; (viii) risks related to the inability of the combined company to success operate as a combined business; and (ix) risks associated with the possible failure to realize certain anticipated benefits of the proposed Merger, including with respect to future financial and operating results, among others. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. These and other risks and uncertainties are more fully described in periodic filings with the SEC, including the factors described in the section titled “Risk Factors” in Star’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC, and in other filings that Star makes and will make with the SEC in connection with the proposed Merger, including the Proxy Statement/Prospectus described below under “Additional Information and Where to Find It.” You should not place undue reliance on these forward-looking statements, which are made only as of the date hereof or as of the dates indicated in the forward-looking statements. Star expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard
thereto or any change in events, conditions or circumstances on which any such statements are based. This press release does not purport to summarize all of the conditions, risks and other attributes of an investment in Star or Harte Hanks.
Participants in the Solicitation
Star, Harte Hanks, and their respective directors and certain of their executive officers and employees may be considered participants in the solicitation of proxies from Harte Hanks’s stockholders with respect to the proposed Merger under the rules of the SEC. Information about the directors and executive officers of Star is set forth in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on April 30, 2026 and certain other documents filed by Star with the SEC, and in subsequent documents filed with the SEC. Information about Harte Hanks’s directors and officers is available in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on April 9, 2026, and in subsequent documents filed by Harte Hanks with the SEC. Additional information will be made available to you regarding the persons who may be deemed participants in the proxy solicitations and their direct and indirect interests (by security holdings or otherwise) in the Merger and related transactions in a registration statement on Form S-4 (the “Form S-4”) that will contain the Proxy Statement/Prospectus, and other relevant materials, each that will be filed with the SEC and disseminated to Harte Hank’s stockholders when they become available. Instructions on how to obtain free copies of this document and, when available, the Form S-4 and Proxy Statement/Prospectus, are set forth below in the section headed “Additional Information and Where to Find It”.
This press release relates to the proposed Merger involving Star and Harte Hanks and may be deemed to be solicitation material with respect to Harte Hanks’s stockholders in respect of the proposed Merger. In connection with the proposed Merger, Star will file the Form S-4 and Proxy Statement/Prospectus. This press release is not a substitute for the Form S-4, the Proxy Statement/Prospectus or for any other document that Star or Harte Hanks may file with the SEC and or that Harte Hanks may send to its stockholders in connection with the proposed Merger. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF HARTE HANKS ARE URGED TO READ THE FORM S-4, THE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT STAR, HARTE HANKS, THE PROPOSED MERGER AND RELATED MATTERS.
No Offer or Solicitation
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities nor a solicitation of any vote or approval with respect to the proposed transaction or otherwise. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended, and otherwise in accordance with applicable law.
Additional Information and Where to Find It
Investors and security holders will be able to obtain free copies of the Form S-4, the Proxy Statement/Prospectus and other documents filed by Star and Harte Hanks with the SEC through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed by Star with the SEC will also be available free of charge on Star’s website at www.starequity.com and copies of the documents filed by Harte Hanks with the SEC will also be available free of charge on Harte Hanks’ website at www.hartehanks.com.
For more information contact:
Investor Relations The Equity Group Lena Cati 212-836-9611 / lcati@theequitygroup.com | Star admin@starequity.com Harte Hanks investorrelations@hartehanks.com | ||||
August 14, 2026 Merger of Harte Hanks, Inc. (Nasdaq: HHS) into Star Equity Holdings, Inc. (Nasdaq: STRR; STRRP) Merger Presentation Important Disclaimer This presentation contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, express or implied statements regarding the structure, timing and completion of the proposed Merger; expectations regarding the ownership structure of the combined company; the anticipated timing of closing; the expected executive officers and directors of the combined company; the future operations of the combined company; the nature, strategy and focus of the combined company; the executive and board structure of the combined company; and other statements that are not historical fact. All statements other than statements of historical fact contained in this presentation are forward-looking statements. These forward-looking statements are made as of the date they were first issued, and were based on the then-current expectations, estimates, forecasts, and projections, as well as the beliefs and assumptions of management. There can be no assurance that future developments affecting Star, Harte Hanks, or the proposed Merger will be those that have been anticipated. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Star’s control. Star’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to (i) the risk that the conditions to the closing of the proposed Merger are not satisfied, including the failure to timely obtain stockholder approval for the Merger, if at all; (ii) uncertainties as to the timing of the consummation of the proposed Merger and the ability of each of Star and Harte Hanks to consummate the proposed Merger; (iii) risks related to Star’s ability to manage its operating expenses and its expenses associated with the proposed Merger pending closing; (iv) risks related to the failure or delay in obtaining required approvals from any governmental or quasi-governmental entity necessary to consummate the proposed Merger; (v) risks related to the market price of the Star preferred stock relative to the value suggested by the merger consideration; (vi) unexpected costs, charges or expenses resulting from the Merger; (vii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed Merger; (viii) risks related to the inability of the combined company to success operate as a combined business; and (ix) risks associated with the possible failure to realize certain anticipated benefits of the proposed Merger, including with respect to future financial and operating results, among others. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. These and other risks and uncertainties are more fully described in periodic filings with the SEC, including the factors described in the section titled “Risk Factors” in Star’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC, and in other filings that Star makes and will make with the SEC in connection with the proposed Merger, including the Proxy Statement/Prospectus described below under “Additional Information and Where to Find It.” You should not place undue reliance on these forward-looking statements, which are made only as of the date hereof or as of the dates indicated in the forward-looking statements. Star expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. This presentation does not purport to summarize all of the conditions, risks and other attributes of an investment in Star or Harte Hanks. Participants in the Solicitation Star, Harte Hanks, and their respective directors and certain of their executive officers and employees may be considered participants in the solicitation of proxies from Harte Hanks’s stockholders with respect to the proposed Merger under the rules of the SEC. Information about the directors and executive officers of Star is set forth in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on April 30, 2026 and certain other documents filed by Star with the SEC, and in subsequent documents filed with the SEC. Information about Harte Hanks’s directors and officers is available in its Definitive Proxy Statement related to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on April 9, 2026, and in subsequent documents filed by Harte Hanks with the SEC. Additional information will be made available to you regarding the persons who may be deemed participants in the proxy solicitations and their direct and indirect interests (by security holdings or otherwise) in the Merger and related transactions in a registration statement on Form S-4 (the “Form S-4”) that will contain the Proxy Statement/Prospectus, and other relevant materials, each that will be filed with the SEC and disseminated to Harte Hank’s stockholders when they become available. Instructions on how to obtain free copies of this document and, when available, the Form S-4 and Proxy Statement/Prospectus, are set forth below in the section headed “Additional Information and Where to Find It”. This presentation relates to the proposed Merger involving Star and Harte Hanks and may be deemed to be solicitation material with respect to Harte Hanks’s stockholders in respect of the proposed Merger. In connection with the proposed Merger, Star will file the Form S-4 and Proxy Statement/Prospectus. This presentation is not a substitute for the Form S-4, the Proxy Statement/Prospectus or for any other document that Star or Harte Hanks may file with the SEC and or that Harte Hanks may send to its stockholders in connection with the proposed Merger. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF HARTE HANKS ARE URGED TO READ THE FORM S-4, THE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT STAR, HARTE HANKS, THE PROPOSED MERGER AND RELATED MATTERS. 2 Transaction Summary Star Equity Holdings, Inc. (“Star”) to acquire Harte Hanks Inc. (“Harte Hanks”) for $5.00/share ~$384M FY2025 pro forma revenue ~$30M (1) FY2025 pro forma adj. EBITDA $10M cost synergies Scale and diversification Creates a multi-BPO platform across talent solutions, customer care, marketing, sales, and fulfillment & logistics Financing Capacity Increased ability to finance growth, including acquisitions, by leveraging the combined company’s larger scale and credit profile Synergy upside ~$10M of run-rate savings from duplicative public-company and corporate overhead costs Balanced consideration Up to 50% cash with the balance in STRRP preferred, funded by a mix of cash on hand and debt financing NOL utilization The combined company will benefit from Star's $215 million U.S. Federal net operating losses (“NOL”) (2) Owner mindset Star’s Board and management own approximately 35% of shares outstanding (3) and expect to own more over time (1) Includes $10M of anticipated cost synergies from merger of Star and Harte Hanks. See slide 9 for additional detail. (2) As of December 31, 2025. (3) Excludes unvested and unissued RSUs as of 8/12/2026 Indicative terms: $5.00 / share · ~$38.4M equity value · up to 50% cash / balance STRRP preferred 3 Transaction Details and Terms Consideration and Financing Consideration mix Up to 50% cash; balance in Star Series A preferred (Nasdaq: STRRP) Election Shareholder election; cash capped at ~$19.2M, preferred uncapped Preferred terms $10.00 liquidation preference, 10% perpetual cash dividend Financing Cash portion funded with cash on hand and debt financing Approvals and Closing Conditions Board approvals Approved by the Boards of both Star and Harte Hanks Stockholder vote Harte Hanks shareholder approval required prior to close Other conditions Form S-4 and other closing conditions 4 Transaction will be accretive from day one and is funded without issuing common stock At close, Harte Hanks, Inc. will merge with and into a wholly owned subsidiary of Star Equity Holdings, Inc.; Star Equity Holdings, Inc. will be the surviving public entity and will continue trading on Nasdaq $5.00 per share of HHS, in cash and STRRP ~$38.4M implied equity value on ~7.68M shares Q4 2026 expected close, subject to conditions
Strategic Rationale: Creating a Larger, Diversified BPO Offering Adding Harte Hanks to Star’s Business Services division to build a larger, diversified BPO platform Recruitment process outsourcing Executive & contingent search Talent intelligence Hudson Talent Solutions + Fulfillment & Logistics Customer Care Revenue Solutions Harte Hanks = C O M B I N E D Star BPO Platform Multiple BPOs serving Fortune 500 clients using shared services and cross selling Larger, diversified BPO An enterprise-wide outsourcing platform built on Hudson and Harte Hanks’ infrastructure, operations, and account teams Meaningful cost synergies Removes duplicative public-company, back-office, and leadership costs Cross-sell upside Shared blue-chip clients and the same buyers create cross-sell opportunities across the platform Addition of HHS to Hudson Talent Solutions creates a scaled, diversified BPO platform 5 Harte Hanks — Business Divisions (1) Three complementary BPO offerings that benefit from scale, cross-sell reach, and shared infrastructure as part of Star’s Business Services division (1) All financials from HHS FY2025 and FY2024 earnings releases; revenue Solutions was reported as Marketing Services prior to FY2025. $74.4M 47% of FY2025A revenue Pick, pack and ship, kitting and print distribution, plus 3PL freight moving 1.3B+ lbs a year through 9,000+ carriers Fulfillment & Logistics 85.0 82.0 74.4 8.9 5.8 6.6 FY23 FY24 FY25 Revenue ($M) EBITDA ($M) $50.1M 31% of FY2025A revenue 2,000+ trained agents across phone, chat, email and social, plus CRM development, AI chatbots and self- service tools Customer Care 53.6 52.9 50.1 9.5 10.1 6.2 FY23 FY24 FY25 Revenue ($M) EBITDA ($M) $35.1M 22% of FY2025A revenue B2B marketing agency, DataView data services and outsourced inside sales Revenue Solutions 52.9 50.3 35.1 6.6 5.2 5.6 FY23 FY24 FY25 Revenue ($M) EBITDA ($M) 6 Newco’s larger size Shareholder value creation Our plan: build scale through disciplined acquisitions • Microcap aggregation over the long-term optimizes shareholder value creation • NewCo is a logical aggregator of select micro-caps that meet our acquisition criteria • Medium-term (~5-year) goals: outperform the Russell 2000 Index and earn inclusion • Organic growth complemented by accretive acquisitions to scale quickly and profitably (1) Less than $250 million market capitalization. (2) Illiquidity leads to less investor interest, which in turn drives further illiquidity. Harte Hanks is Star’s second micro-cap merger in the past year, after the combination of Hudson Global and Star in August 2025 — transformative steps that leave us materially stronger and better able to create shareholder value Structural disadvantages of a micro-cap (1) Cost burden Public-company costs consume a disproportionate share of revenue Capital access Limited ability to raise equity or debt on attractive terms Market visibility Smaller investor base and limited analyst coverage Negatives of being a micro-cap vs a larger-cap stock: Lower liquidity Less buying / investor interest Lower valuations / multiples “Micro-Cap Purgatory” (2)2 1 7 Star Following the Merger Reporting Segments (1) Business Services Building Solutions Investments Building Solutions Other Investments Business ServicesBusiness Services Business Services Business Services Real Estate Assets Inve tm nts + Future bolt-on acquisitions Energy Services + Future bolt-on acquisitions + Future bolt-on acquisitions (1) On August 22, 2025, the Company completed its previously announced acquisition of Star Operating Companies, Inc. (“Star Operating”, formerly known as Star Equity Holdings, Inc.), pursuant to the Agreement and Plan of Merger, dated as of May 21, 2025 (the “Merger Agreement”), by and among the Company, Star Operating and HSON Merger Sub, Inc., a wholly owned subsidiary of the Company (“Merger Sub”). Upon the terms and subject to the conditions of the Merger Agreement, on August 22, 2025, at the effective time of the merger pursuant to the Merger Agreement (the “Merger”), Merger Sub merged with and into Star Operating, with Star Operating continuing as the surviving corporation of the Merger as a wholly owned subsidiary of the Company. Effective September 5, 2025, the Company changed (i) its name to Star Equity Holdings, Inc. and (ii) its trading symbol on Nasdaq to STRR and STRRP. Future Divisions To be established with the potential acquisition of new verticals 8
Reconciliation of Pro Forma Adjusted EBITDA 9 1. For Star Equity, pro forma Building Solutions and Investments results for the full year of 2025 as opposed to August 22, 2025 through December 31, 2025. Pro forma Energy Services reflects results from Alliance Drilling Tools for the full year in 2025. Alliance Drilling Tools was acquired by Star Operating Companies on March 3, 2025. 2. Pro forma Non-GAAP earnings before interest, income taxes, and depreciation and amortization (“EBITDA”) and non-GAAP earnings before interest, income taxes, depreciation and amortization, non- operating (income) expense, stock-based compensation expense, and other non-recurring expenses (“Adjusted EBITDA”) are presented to provide additional information about the Company's operations on a basis consistent with the measures which the Company uses to manage its operations and evaluate its performance. Management also uses these measurements to evaluate capital needs and working capital requirements. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, cash flows from operating activities, and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of the Company's profitability or liquidity. Furthermore, EBITDA and Adjusted EBITDA as presented above may not be comparable with similarly titled measures reported by other companies. $ in 000s Unaudited Star Equity (pro forma) Harte Hanks Combined Net loss ($4,058) ($811) ($4,869) Provision for (benefit from) income taxes 330 (197) 133 Interest (income) expense, net (78) - (78) Other expenses, net - 1,394 1,394 Depreciation and amortization 5,618 4,472 10,090 Pro forma EBITDA (non-GAAP) 1,812 4,858 6,670 Stock-based compensation 1,671 258 1,929 Restructuring expense - 1,782 1,782 Transaction costs related to mergers and acquisitions 5,004 - 5,004 Severance / contingent salary 891 - 891 Interest income 1,249 - 1,249 Impairment of cost method investment 432 - 432 Loss (gain) on equity method investment 755 - 755 Foreign currency (gain) loss 303 - 303 Unrealized (gain) loss on equity securities 35 - 35 Financing cost 114 - 114 Other non-operating expense (income) (4) - (4) Other non-recurring expenses 363 - 363 Pro forma Adjusted EBITDA (non-GAAP) $12,625 $6,898 $19,523 Estimated annualized run-rate cost synergies 10,000 Pro forma Adjusted EBITDA post-synergies (non-GAAP) $29,523 10 Contact Us Jeff Eberwein CEO Rick Coleman COO Shawn Miles EVP – Finance admin@starequity.com Investor Relations The Equity Group Inc. Lena Cati Senior Vice President 212-836-9611 / lena.cati@theequitygroup.com 10