Basis of Presentation

Our Unaudited Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America, with the instructions to Form 10-Q and with Article 10 of Regulation S-X of the Securities and Exchange Commission, and include all adjustments that are, in management’s opinion, necessary for a fair presentation of the results for the interim periods presented. All such adjustments are, in the opinion of management, of a normal recurring nature. Results for the six-month period ended June 30, 2026, are not necessarily indicative of the operating results to be expected for the full year.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted from these Unaudited Condensed Consolidated Financial Statements. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Finance Receivables Measured at Fair Value

Finance Receivables Measured at Fair Value

Effective January 1, 2018, we adopted the fair value method of accounting for finance receivables acquired on or after that date. For each finance receivable acquired after 2017, we consider the price paid on the purchase date as the fair value for such receivable. We estimate the cash to be received in the future with respect to such receivables, based on our experience with similar receivables acquired in the past. We then compute the internal rate of return that results in the present value of those estimated cash receipts being equal to the purchase date fair value. Thereafter, we recognize interest income on such receivables on a level yield basis using that internal rate of return as the applicable interest rate. Cash received with respect to such receivables is applied first against such interest income, and then to reduce the recorded value of the receivables.

We re-evaluate the fair value of such receivables at the close of each measurement period. If the reevaluation were to yield a value materially different from the recorded value, an adjustment would be required.

Anticipated credit losses are included in our estimation of cash to be received with respect to receivables. In accordance with the fair value accounting standards, credit losses are included in our computation of the appropriate level yield, therefore we do not thereafter make periodic provision for credit losses, as our best estimate of the lifetime aggregate of credit losses is included in that initial computation. Also, because we include anticipated credit losses in our computation of the level yield, the computed level yield is materially lower than the average contractual rate applicable to the receivables. Because our initial recorded value is fixed as the price we pay for the receivable, rather than the contractual principal balance, we do not record acquisition fees as an amortizing asset related to the receivables, nor do we capitalize costs of acquiring the receivables. Rather we recognize the costs of acquisition as expenses in the period incurred.

Leases

Leases

The Company has operating leases for corporate offices, equipment, software and hardware. The Company has entered into operating leases for the majority of its real estate locations, primarily office space. These leases are generally for periods of three to seven years with various renewal options. The depreciable life of leased assets is limited by the expected lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet and the related lease expense is recognized on a straight-line basis over the lease term.

The following table presents the supplemental balance sheet information related to leases:


	June 30,			December 31,
	2026			2025
	(In thousands)
Operating Leases
Operating lease right-of-use assets	$	53,225		$	53,225
Less: Accumulated amortization right-of-use assets		(38,620	)		(36,281	)
Operating lease right-of-use assets, net	$	14,605		$	16,944

Operating lease liabilities	$	(16,765	)	$	(19,236	)

Finance Leases
Property and equipment, at cost	$	4,589		$	4,097
Less: Accumulated depreciation		(3,869	)		(3,684	)
Property and equipment, net	$	720		$	413

Finance lease liabilities	$	(743	)	$	(428	)

Weighted Average Discount Rate
Operating lease		5.0%			5.0%
Finance lease		6.6%			6.4%

Maturities of lease liabilities were as follows:


(In thousands)	Operating			Finance
Year Ending December 31,	Lease			Lease
2026 (excluding the six months ended June 30, 2026)	$	2,814		$	206
2027		5,756			355
2028		5,937			234
2029		4,331			10
2030		1,171			–
2031		719			–
Thereafter		50			–
Total undiscounted lease payments		20,778			805
Less amounts representing interest		(4,013	)		(62	)
Lease Liability	$	16,765		$	743

The following table presents the lease expense included in General and administrative and Occupancy expense on our Unaudited Condensed Consolidated Statement of Operations:

Schedule of lease cost
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
	(In thousands)				(In thousands)
Operating lease cost	$	1,317	$	1,310	$	2,637	$	2,621
Finance lease cost		103		55		207		110
Total lease cost	$	1,420	$	1,365	$	2,844	$	2,731

The following table presents the supplemental cash flow information related to leases:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
Cash paid for amounts included in the measurement of lease liabilities:	(In thousands)				(In thousands)
Operating cash flows from operating leases	$	1,317	$	1,310	$	2,637	$	2,621
Operating cash flows from finance leases		89		47		177		94
Financing cash flows from finance leases		14		7		30		15

Purchases of Company Stock

Purchases of Company Stock

The table below describes the purchase of our common stock for the six months ended June 30, 2026, and 2025:


	Six Months Ended
	June 30, 2026				June 30, 2025
	Shares		Avg. Price		Shares		Avg. Price
Open market purchases		22,736	$	9.79		76,880	$	9.72
Shares redeemed upon net exercise of stock options		257,756	$	9.04		449,772	$	9.76
Other		120,000	$	9.51		–	$	–
Total stock purchases		400,492	$	9.22		526,652	$	9.76

Financial Covenants

Financial Covenants

Certain of our securitization transactions, our warehouse credit facilities and our residual interest financing contain various financial covenants requiring minimum financial ratios and results. Such covenants include maintaining minimum levels of liquidity and net worth and not exceeding maximum leverage levels. As of June 30, 2026, we were in compliance with all such covenants. In addition, certain of our debt agreements other than our term securitizations contain cross-default provisions. Such cross-default provisions would allow the respective creditors to declare a default if an event of default occurred with respect to other indebtedness of ours, but only if such other event of default were to be accompanied by acceleration of such other indebtedness.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

We do not believe that any accounting pronouncements issued, but not yet effective, are applicable or would have a material impact on our consolidated financial statements or disclosures, if adopted.