v3.26.1
Fair Value Measurements
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements

4. Fair Value Measurements

The Company applies the provisions of ASC Topic 820, Fair Value Measurement (“ASC 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the exit price) in an orderly transaction between market participants at the measurement date.

ASC 820 establishes a hierarchical disclosure framework that prioritizes and ranks the level of market price observability used in measuring assets and liabilities at fair value. Under U.S. GAAP, a fair value hierarchy is implemented for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

The fair value hierarchy is categorized into three levels based on the inputs as follows:

•
Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities and in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
•
Level 2 — Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.
•
Level 3 — Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Changes in the observability of valuation inputs may result in a reclassification for certain financial assets or liabilities. In addition to using the above inputs in asset or liability valuations, the Company continues to employ the valuation policy that is consistent with ASC 820.

The following table presents information about the Company’s assets and liabilities by level within the valuation hierarchy measured at fair value on a recurring basis (in thousands). Refer to Note 5 for further detail on the industry and geographic concentration:

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Amount at
Fair Value

 

June 30, 2026

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Loans held for investment, at fair value

 

 

 

 

 

 

 

 

 

 

 

 

Private loans:

 

 

 

 

 

 

 

 

 

 

 

 

MRP+ Loans

 

$

-

 

 

$

-

 

 

$

186,045

 

 

$

186,045

 

Non-MRP+ Loans

 

 

-

 

 

 

-

 

 

 

73,839

 

 

 

73,839

 

Total loans held for investment, at fair value

 

 

-

 

 

 

-

 

 

 

259,884

 

 

 

259,884

 

Derivative asset

 

 

-

 

 

 

367

 

 

 

-

 

 

 

367

 

Total assets

 

$

-

 

 

$

367

 

 

$

259,884

 

 

$

260,251

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Other liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Medallion incentive liability

 

$

-

 

 

$

-

 

 

$

1,706

 

 

$

1,706

 

Warrant liabilities

 

 

-

 

 

 

23

 

 

 

-

 

 

 

23

 

Total liabilities

 

$

-

 

 

$

23

 

 

$

1,706

 

 

$

1,729

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Amount at
Fair Value

 

December 31, 2025

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Loans held for investment, at fair value

 

 

 

 

 

 

 

 

 

 

 

 

Private loans:

 

 

 

 

 

 

 

 

 

 

 

 

MRP+ Loans

 

$

-

 

 

$

-

 

 

$

192,449

 

 

$

192,449

 

Non-MRP+ Loans

 

 

-

 

 

 

-

 

 

 

89,222

 

 

 

89,222

 

Total loans held for investment, at fair value

 

 

-

 

 

 

-

 

 

 

281,671

 

 

 

281,671

 

Total assets

 

$

-

 

 

$

-

 

 

$

281,671

 

 

$

281,671

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Other liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Medallion incentive liability

 

$

-

 

 

$

-

 

 

$

1,181

 

 

$

1,181

 

Warrant liabilities

 

 

-

 

 

 

51

 

 

 

-

 

 

 

51

 

Total liabilities

 

$

-

 

 

$

51

 

 

$

1,181

 

 

$

1,232

 

 

The following table provides a reconciliation of the beginning and ending balances for loans held for investment, at fair value that use Level 3 inputs (in thousands):

 

 

MRP+ Loans

 

 

Non-MRP+ Loans

 

Balance as of January 1, 2025

 

$

201,106

 

 

$

79,892

 

Gains on loans held for investment, net

 

 

7,859

 

 

 

756

 

Origination of Non-MRP+ loans from medallion disposals

 

 

-

 

 

 

495

 

Origination of Non-MRP+ loans from MRP+ settlements

 

 

(4,550

)

 

 

4,550

 

Purchase of loans in TML Asset Acquisition

 

 

5,065

 

 

 

8,929

 

Collateral foreclosures

 

 

(11,900

)

 

 

(385

)

Loan repayments

 

 

(5,131

)

 

 

(5,015

)

Balance as of December 31, 2025

 

$

192,449

 

 

$

89,222

 

Losses on loans held for investment, net

 

 

(1,406

)

 

 

156

 

Origination of Non-MRP+ loans from medallion disposals

 

 

-

 

 

 

175

 

Origination of Non-MRP+ loans from MRP+ settlements

 

 

(2,640

)

 

 

2,640

 

Collateral foreclosures

 

 

-

 

 

 

(17,225

)

Loan repayments

 

 

(2,358

)

 

 

(1,129

)

Balance as of June 30, 2026

 

$

186,045

 

 

$

73,839

 

Net change in estimated fair value of Level 3 loans still held as of June 30, 2026 included in losses on loans held for investment, net on the condensed consolidated statements of operations, was a net decrease of $1.5 million and $0.6 million for the three and six months ended June 30, 2026, respectively. Net change in fair value from Level 3 loans still held as of June 30, 2025 was a net decrease of $2.2 million and $5.6 million for the three and six months ended June 30, 2025.

With respect to instruments valued by management, the valuation techniques employed are an income approach reflecting a discounted cash flow analysis, and a market approach that includes market transactions.

The following table summarizes the valuation techniques and significant unobservable inputs used for the Company‘s assets and liabilities that are categorized within Level 3 of the fair value hierarchy (in thousands):

June 30, 2026

 

 Loans held for investment, at fair value

 

Fair Value

 

 

Approach

 

Unobservable
Inputs

 

Low Range

 

 

High Range

 

 

Weighted
Average5

 

 MRP+ Loans

 

$

186,045

 

 

Income
Approach1

 

Discount
Rate2

 

8.00%

 

 

8.00%

 

 

8.00%

 

 Non-MRP+ Loans - NYC

 

 

64,744

 

 

Market
Approach3

 

Discounted
Medallion
Price4

 

$

166,250

 

 

$

166,250

 

 

$

166,250

 

 Non-MRP+ Loans - Other

 

 

9,095

 

 

Market Approach

 

Market Medallion Price

 

$

6,500

 

 

$

110,000

 

 

$

18,665

 

 

$

259,884

 

 

 

 

 

 

 

 

 

 

 

 

 

 
(1)
Used to value MRP+ loan cash flows.
(2)
The discount rate is utilized to present value cash flows from loans restructured by the City of New York under the MRP+ program (at a price of $170,000). To determine the discount rate, the Company considers the internal rate of return on the investment, changes in the U.S. Treasury rates to maturity of the loans and a risk premium for the likelihood of whether a loan will be successfully restructured under the MRP+ program.
(3)
The most significant inputs include recent Company medallion sale prices (ranging from $166,206 to $210,000), the amount backstopped under the MRP+ ($170,000), and certain market prices reported by the TLC (ranging from $50,500 to $180,000). In addition, loans are valued at the lesser of unpaid principal balance and the medallion or other collateral value (such as commercial and residential real estate which generally does not exceed 5% of the total loans held for investment, at fair value), less a discount applied to the collateral value. In instances where loans are overcollateralized with an unpaid principal balance less than or equal to $165,000 as of June 30, 2026, these loans are determined to have a fair value equal to par. Significant increases or decreases in such factors, or structural and/or regulatory changes to the New York City taxi industry would result in a significantly lower or higher fair value measurement.
(4)
New York City medallion price valuation inputs were determined using a value of $175,000 for each medallion, calculated as the midpoint between an estimated range, of which the low value was $165,000 and the high value was $185,000. A 5% discount is applied to the market medallion price for New York City medallions to estimate costs associated with taking ownership of a medallion as the medallions are not directly held by the Company. The medallion incentive liability was determined based on the significant inputs of the New York City market medallion price described above resulting in a fair value of $175,000 for each medallion on a pro rata basis pursuant to the Consulting Agreement (see Note 11).
(5)
Weighted average medallion prices are calculated based on the total fair value of underlying medallion collateral.

The following table summarizes the valuation techniques and significant unobservable inputs used for the Company’s assets and liabilities that are categorized within Level 3 of the fair value hierarchy (in thousands):

December 31, 2025

 

 Loans held for investment,
at fair value

 

Fair Value

 

 

Approach

 

Unobservable
Inputs

 

Low Range

 

 

High Range

 

 

Weighted
Average5

 

 MRP+ Loans

 

$

192,449

 

 

Income
Approach1

 

Discount
Rate2

 

7.50%

 

 

7.50%

 

 

7.50%

 

 Non-MRP+ Loans - NYC

 

 

78,579

 

 

Market
Approach3

 

Discounted
Medallion
Price4

 

$

166,250

 

 

$

166,250

 

 

$

166,250

 

 Non-MRP+ Loans - Other

 

 

10,643

 

 

Market
Approach

 

Market Medallion Price

 

$

7,000

 

 

$

110,000

 

 

$

17,450

 

 

 

$

281,671

 

 

 

 

 

 

 

 

 

 

 

 

 

 
(1)
Used to value MRP+ loan cash flows.
(2)
The discount rate is utilized to present value cash flows from loans restructured by the City of New York under the MRP+ program (at a price of $170,000). To determine the discount rate, the Company considers the internal rate of return on the investment, changes in the U.S. Treasury rates to maturity of the loans and a risk premium for the likelihood of whether a loan will be successfully restructured under the MRP+ program.
(3)
The most significant inputs include recent Company medallion sale prices (ranging from $166,206 to $210,000), the amount backstopped under the MRP+ ($170,000), and certain market prices reported by the TLC (ranging from $81,667 to $175,000). In addition, loans are valued at the lesser of unpaid principal balance and the medallion or other collateral value (such as commercial and residential real estate which generally does not exceed 5% of the total loans held for investment, at fair value), less a discount applied to the collateral value. In instances where loans are overcollateralized with an unpaid principal balance less than or equal to $165,000 as of December 31, 2025, these loans are determined to have a fair value equal to par. Significant increases or decreases in such factors, or structural and/or regulatory changes to the New York City taxi industry would result in a significantly lower or higher fair value measurement.
(4)
New York City medallion price valuation inputs were determined using a value of $175,000 for each medallion, calculated as the midpoint between an estimated range, of which the low value was $165,000 and the high value was $185,000. A 5% discount is applied to the Market Medallion Price for New York City medallions to estimate costs associated with taking ownership of a medallion as the medallions are not directly held by the Company. The medallion incentive liability was determined based on the significant inputs of the New York City market medallion price described above resulting in a fair value of $175,000 for each medallion on a pro rata basis pursuant to the Consulting Agreement (see Note 11).
(5)
Weighted average medallion prices are calculated based on the total fair value of underlying medallion collateral.

The value of the underlying collateral and thus, the portfolio of loans may be impacted by multiple factors including, but not limited to, general macroeconomic conditions, as well as the state of the taxi industry, loan restructurings, governmental initiatives, and medallion transfers. Without a readily ascertainable market value, the estimated value of the Company‘s portfolio of loans held for investment, at fair value may differ significantly from the values that would be placed on the portfolio if a readily determinable market existed for the loans. The illiquidity of the Company’s loan portfolio may adversely affect the Company’s ability to dispose of loans at times when it may be advantageous for the Company to liquidate such portfolio. In addition, if the Company were required to liquidate some or all of the loans in the portfolio, the proceeds of such liquidation may be significantly less than the current value of such loans. Changes in the various unobservable inputs used to determine valuations may have similar or diverging impacts on valuation. Significant increases or decreases in these inputs in isolation and interrelationships between those inputs could result in significantly higher or lower fair value measurements than noted in the tables above.