WORLD ACCEPTANCE CORP

The following table presents the assets and liabilities of our consolidated VIE. These assets and liabilities are included in the Consolidated Balance Sheets presented above. Refer to Note 6 for additional information.

CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

CONSOLIDATED STATEMENTS OF CASH FLOWS

The following table reconciles cash and restricted cash from the Consolidated Balance Sheets to the Consolidated Statements of Cash Flows above:

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 –BASIS OF PRESENTATION

The consolidated financial statements of the Company at September 30, 2026 and 2025 and for the three and six months then ended were prepared in accordance with the instructions for Form 10-Q and are unaudited; however, in the opinion of management, all adjustments (consisting only of items of a normal, recurring nature) necessary for a fair presentation of the financial position at September 30, 2026, and the results of operations and cash flows for the periods ended September 30, 2026 and 2025, have been included. The results for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates.

The consolidated financial statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the fiscal year ended March 31, 2026, included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2026, as filed with the SEC (the "fiscal 2026 Annual Report"). The Company applies the accounting policies contained in Note 1 to the Consolidated Financial Statements included in the fiscal 2026 Annual Report. The Company believes that the disclosures are adequate to make the information presented not misleading.

NOTE 2 –SUMMARY OF SIGNIFICANT POLICIES

Nature of Operations

The Company is a small-loan consumer finance company headquartered in Greenville, South Carolina that offers short-term small loans, medium-term larger loans, related credit insurance products and ancillary products and services to individuals who have limited access to other sources of consumer credit. The Company offers income tax return preparation services to its loan customers and other individuals.

Seasonality

The Company's loan volume and corresponding loans receivable follow seasonal trends. The Company's highest loan demand generally occurs from October through December, its third fiscal quarter. Loan demand is generally lowest and loan repayment highest from January to March, its fourth fiscal quarter. Loan volume and average balances remain relatively level during the remainder of the year. Consequently, the Company experiences significant seasonal fluctuations in its operating results and cash needs. Operating results for the Company's third fiscal quarter are generally lower than in other quarters, and operating results for its fourth fiscal quarter are generally higher than in other quarters.

Restricted cash

Restricted cash includes cash for which the Company’s ability to withdraw or use funds is contractually limited. The Company’s restricted cash consists of cash reserves associated with its captive insurance subsidiary that reinsures a portion of the credit insurance sold in connection with loans made by the Company, and cash restricted for debt servicing of the Company’s Warehouse facility. The Company had $19.0 million and $23.3 million in restricted cash as of September 30, 2026 and March 31, 2026, respectively.

Loans receivable, net

Loans receivable are carried at amortized cost, which is the gross amount outstanding, reduced by unearned interest and insurance income, net of deferred origination fees and direct costs, and an allowance for credit losses. Fees received and direct costs incurred for the origination of loans are deferred and amortized to interest income over the contractual lives of the loans using the interest method. Unamortized amounts are recognized in income at the time that loans are refinanced or paid in full except for those refinancings that do not constitute a more than minor modification. Net unamortized deferred origination costs were $5.8 million and $5.9 million as of September 30, 2026 and March 31, 2026, respectively.

The Company sells charged off loans receivable, which are accounted for as a sale in accordance with ASC 860, Transfers and Servicing. See Note 5 to the Consolidated Financial Statements for further information.

Allowance for credit losses

Refer to Note 5 to the Consolidated Financial Statements for information regarding the Company's CECL allowance model and a description of the policies and methodology utilized.

Insurance and Other Income

Insurance and other income for the three and six months ended September 30, 2026 and 2025 consist of:

Insurance income is recognized over the life of the related insurance contracts. Auto club membership income and other income are recognized at a point in time when the product or service is provided. As it relates to tax return preparation income, contracts associated with these services include two performance obligations, tax return preparation services and refund assurance services, as each service is capable of being distinct and is separately identifiable in the contract. Tax return preparation services are recognized at a point in time in the period the return is filed, and refund assurance services are recognized ratably over time as the performance obligation is met (performance period is approximately 36 months). Specifically, the Company's Refund Assurance Plan ("RAP") provides enrolled customers with (a) audit representation before the IRS and (b) reimbursement of verified tax preparation errors up to $5,000 for a three-year coverage period beginning at the IRS acceptance date for each return and ending on April 15 three years after the applicable filing deadline. Refund assurance fees create a contract liability at the time of funding, which is presented as Deferred revenue (contract liability) in the Company's Consolidated Balance Sheets. The contract liability is released ratably as the performance period elapses. Revenue recognized during the three and six months ended September 30, 2026 that was included in the Deferred revenue (contract liability) balance at March 31, 2026 was $0.5 million and $0.9 million, respectively.

The following is a summary of the changes in Deferred revenue (contract liability) for the three and six months ended September 30, 2026 and 2025:

Reclassification

From time to time, prior period amounts will be reclassified to conform to the current presentation. Such reclassifications have no impact on previously reported net income or shareholders' equity.

Share Repurchases

On August 13, 2026, the Board of Directors authorized the Company to repurchase up to $50.0 million of the Company’s outstanding common stock, inclusive of the amount that remained available for repurchase under prior repurchase authorizations. As of September 30, 2026, the Company had $25.0 million in aggregate remaining repurchase capacity under its current share repurchase program. The Company expects to repurchase shares in fiscal 2027; however, the timing and actual number of shares repurchased will depend on a variety of factors, including the stock price, corporate and regulatory requirements, available funds, alternative uses of capital, restrictions under the Revolving Credit Agreement, and other market and economic conditions. The Company’s stock repurchase program may be suspended or discontinued at any time.

On August 14, 2026, in accordance with its share repurchase program, the Company, after approval by the Audit and Compliance Committee, repurchased 133,199 shares of its common stock for $25.0 million from Prescott Associates L.P., Idoya Partners L.P., Prescott International Partners L.P., and Prescott Investors, Inc. Profit Sharing (the "Prescott Sellers") in a privately negotiated transaction. The Prescott Sellers are affiliates of Prescott General Partners, LLC, who, along with its affiliates, beneficially own approximately 43.3% of the Company's common stock as of September 30, 2026. The $187.69 price per share was the closing market price at August 14, 2026.

On September 3, 2025, in accordance with its share repurchase program, the Company, after approval by the Audit and Compliance Committee, repurchased 347,064 shares of its common stock for $60.0 million from the Prescott Sellers in a privately negotiated transaction. The $172.88 price per share was the closing market price at September 3, 2025.

The Company continues to believe stock repurchases are a viable component of the Company’s long-term financial strategy and an excellent use of excess cash when the opportunity arises. Additional share repurchases can be made subject to compliance with, among other things, applicable restricted payment covenants under the Revolving Credit Agreement. Our first priority is to ensure we have enough capital to fund loan growth. As of September 30, 2026, subject to further approval from our Board of Directors, we could repurchase approximately $47.5 million of shares under the terms of our Revolving Credit Agreement. To the extent we have excess capital, we may repurchase stock, if appropriate and as authorized by our Board of Directors.

Concentration of Risk

The Company generally serves individuals with limited access to other sources of consumer credit such as banks, credit unions, other consumer finance businesses and credit card lenders. Substantially all new customers are required to submit a listing of personal property that will serve as collateral to secure the loan; however, the Company does not rely on the value of such collateral in the loan approval process and generally does not perfect its security interest in that collateral.

During the three and six months ended September 30, 2026, the Company operated insixteen states in the United States. As of September 30, 2026 and March 31, 2026, gross loan receivable within the Company'sfour largest states accounted for approximately 51% of the Company's gross loans receivable balance.

The Company maintains amounts in bank accounts which, at times, may exceed federally insured limits. The Company has not experienced losses in such accounts, which are maintained with large domestic banks. Management believes the Company’s exposure to credit risk is minimal for these accounts.

Variable interest entities

On September 29, 2025, the Company and its wholly-owned subsidiary, WFC Receivables I, LLC, an SPE (the “Borrower” or the “Warehouse”), entered into a Credit Agreement (the “Credit Agreement”), by and among the Company, as Servicer, the Borrower, the lenders and agents from time to time parties thereto, Atlas Securitized Products Administration, L.P., as administrative agent for the lenders, Systems & Services Technologies, Inc., a Delaware corporation, as backup servicer, and Wilmington Trust, National Association, a national banking association, as securities intermediary.

The Credit Agreement is solely secured by eligible loans receivable that were directly originated by certain of the Company's subsidiaries. The Company transfers these pools of eligible loans receivable to the Warehouse to secure debt for general funding purposes. The Company continues to service the loans receivable transferred to the Warehouse. The Company makes certain representations and warranties about the quality and nature of the loans receivable transferred to the Warehouse. The Credit Agreement requires the Company to repurchase the loans receivable in certain circumstances, including circumstances in which the representations and warranties made by the Company concerning the quality and characteristics of the loans receivable are inaccurate.

The Warehouse has the limited purpose of acquiring loans receivable to be pledged as collateral for funding, in addition to holding and making payments on the related debt. Loans receivable transferred to the Warehouse are legally isolated from the

Company and its affiliates, as well as the claims of the Company’s and its affiliates’ creditors. Further, any assets of the Warehouse are owned by the Warehouse and are the only source of funds for the related debt and are not available to satisfy the debts or other obligations of the Company or any of its affiliates. The lenders to the Warehouse generally only have recourse to the assets pledged to the Warehouse and do not have recourse to the general credit of the Company.

The Warehouse is considered a VIE under ASC 810, Consolidation, as it lacks independent, sufficient equity to fund its activities and because the equity holders lack the power to direct the activities that most significantly affect the Warehouse's economic performance. As such, the Warehouse is consolidated into the financial statements of its primary beneficiary. The Company is considered to be the primary beneficiary of the Warehouse, because, through its role as servicer of the loans receivable, it has (i) the power to direct activities that most significantly impact the economic performance of the Warehouse and (ii) the obligation to absorb losses or receive benefits of the Warehouse that could potentially be significant to the Warehouse, primarily through its economic interest in the pledged loans receivable and residual cash flows. The Company will continue to monitor its involvement and reassess its status as the primary beneficiary.

Historic Tax Credit Investments

The Company holds tax-advantaged investments in unconsolidated entities that own and operate projects through the Federal historic tax credit program. These entities, which are limited liability companies, are designed to generate a return primarily through the realization of tax credits and other tax benefits, such as tax deductions from operating losses of the projects. The historic tax credit investments are considered VIEs under ASC 810, Consolidation, as they lack independent, sufficient equity to fund their activities and because the equity holders lack the power to direct the activities that most significantly affect the historic tax credit investments' economic performance. The Company invests as a limited liability member and lacks the power to direct the entities most significant activities. Therefore, the Company is not considered to be the primary beneficiary and is not required to consolidate the financial result of these VIEs.

Segment Reporting

The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the CODM in deciding how to allocate resources and assess performance. FASB ASC Topic 280 requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way that the operating segments were determined and other items.

The Company hasone reportable segment: the consumer finance segment. The other revenue generating activities of the Company, including the sale of insurance products, income tax preparation, and the automobile club, are done within the existing branch network in conjunction with or as a complement to the lending operations. There is no discrete financial information available for these activities, and they do not meet the criteria under FASB ASC Topic 280 to be considered operating segments. The accounting policies of the Company's segment are described within this Note 1 to the Consolidated Financial Statements, as well as the accounting policies contained in Note 1 to the Consolidated Financial Statements included in the fiscal 2026 Annual Report.

The Company's CODM is its CEO. The CODM utilizes consolidated net income as presented in the Consolidated Statements of Operations to evaluate and measure segment performance and to determine how to allocate resources. Significant segment expenses are consistent with those presented in the Consolidated Statements of Operations, and segment assets are consistent with those presented in the Consolidated Balance Sheets.

Recently Issued Accounting Standards Not Yet Adopted

Purchased Loans

In November 2025, the FASB issued ASU 2025-08, Financial Instruments-Credit Losses (Topic 326): Purchased Loans, which expands the population of acquired financial assets subject to the gross-up approach in Topic 326. In accordance with the amendments in this update, loans (excluding credit cards) acquired without credit deterioration and deemed “seasoned”, which is defined as either 1) Non-PCD loans that are obtained in a business combination or 2) Non-PCD loans that (a) are obtained in an asset acquisition or upon consolidation of a variable interest entity that is not a business and (b) are acquired more than 90 days after their origination date by a transferee that was not involved in their origination, are considered purchased seasoned loans and should be accounted for using the gross-up approach at acquisition. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The amendments should be applied prospectively to loans that are acquired on or after the initial application date. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. Management is currently evaluating this ASU to determine its impact on the Company's consolidated financial statements and related disclosures.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, which requires additional disclosure, in the notes to financial statements, about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, which was clarified by ASU 2025-01, Clarifying the Effective Date. Early adoption is permitted. ASU 2024-03 should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this update or (2) retrospectively to any or all prior periods presented in the financial statements. Management is currently evaluating this ASU to determine its impact on the Company's consolidated financial statements and related disclosures.

We reviewed all other newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on the consolidated financial statements and related disclosures as a result of future adoption.

NOTE 3 –REVISION OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS

During the fourth quarter of fiscal 2026, the Company identified an error in the timing of revenue recognition for its Refund Assurance Plan ("RAP") fees associated with the Company's tax preparation services. The Company had historically recognized RAP fees as revenue at the time the related tax return was prepared. However, the Company determined that under ASC 606, Revenue from Contracts with Customers, these fees should be recognized ratably over the 36-month coverage period of each plan, as the related performance obligation is a stand-ready obligation satisfied over time. Accordingly, the Company should recognize a contract liability for the unearned portion of RAP fees, which is recognized as revenue ratably over the coverage period.

The Company evaluated the error in accordance with SEC Staff Accounting Bulletin No. 99, Materiality, and SEC Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, considering both quantitative and qualitative factors, and concluded that the error was not material, individually or in the aggregate, to any previously issued financial statements. The Company has revised the prior period comparative financial statements presented herein to reflect the correction for comparability purposes. Because the error was not material to any previously issued financial statements, no restatement to any previously filed annual or quarterly report is required.

The effect of the revision on the Company's previously issued consolidated financial statements for each financial statement line item affected is presented in the tables below:

Effect on Consolidated Statements of Operations

1 RAP fees are included within Insurance and other income, net. No other revenue related line item is affected.

Effect on Consolidated Statements of Shareholders' Equity

Retained Earnings Adjustment Summary

Effect on Consolidated Statements of Cash Flows

NOTE 4 –FAIR VALUE

Fair Value Disclosures

The Company may carry certain financial instruments and derivative assets and liabilities at fair value measured on a recurring or nonrecurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Company measures the fair values of its financial instruments based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Fair value measurements are grouped in three levels. These levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are:

•Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2 – Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly. These inputs include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are less active.

•Level 3 – Unobservable inputs for assets or liabilities reflecting the reporting entity’s own assumptions.

As of September 30, 2026, the Company’s financial instruments consist of cash and restricted cash, loans receivable, net, a revolving credit facility and a warehouse facility. Loans receivable are originated at prevailing market rates and have an average life of up to twelve months. Given the short-term nature of these loans, they are priced at current market rates. The Company’s revolving credit facility and warehouse facility have a variable rate based on a margin over SOFR and reprices with any changes in SOFR. The Company also considers its creditworthiness in its estimation of fair value.

The carrying amounts and estimated fair values of financial assets and liabilities disclosed but not carried at fair value and their level within the fair value hierarchy are summarized below.

There were no significant assets or liabilities measured at fair value on a non-recurring basis as of September 30, 2026 or March 31, 2026.

NOTE 5 –LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES

The following is a summary of gross loans receivable by Customer Tenure as of:

Current payment performance is used to assess the capability of the borrower to repay contractual obligations of the loan agreements as scheduled, which is monitored by management on a daily basis. The Company’s payment performance buckets are as follows: current, 30-60 days past due, 61-90 days past due, 91 days or more past due.

All loans, except for TALs, that are greater than 90 days past due on a recency basis and not written off as of the reporting date are reserved for at 100% of the outstanding balance, net of a calculated Rehab Rate. The weighted average Rehab Rate at September 30, 2026 and March 31, 2026 was 5.9% and 5.4%, respectively. A loan is charged off within the allowance for credit losses in the month following when an account reaches 120 days past due on a recency basis, subject to certain exceptions. Specifically, the Company’s customer accounts in a confirmed bankruptcy are generally charged off in the month after they reach 60 days past due on a recency basis. The accounts of deceased or incarcerated customers are also generally charged off in the month after they reach 60 days past due on a recency basis, with the exception of deceased customers with credit life insurance. Subsequent recoveries of amounts charged off, if any, are credited to the allowance for credit losses.

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at September 30, 2026:

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at March 31, 2026:

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at September 30, 2026:

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at March 31, 2026:

The following table provides a breakdown of the Company’s gross charge-offs by fiscal year of origination for the three and six months ended September 30, 2026:

The following table provides a breakdown of the Company’s gross charge-offs by fiscal year of origination for the three and six months ended September 30, 2025:

Credit risk is inherent in the business of extending loans to borrowers and is continuously monitored by management and reflected within the allowance for credit losses for loans. The allowance for credit losses is an estimate of expected losses inherent within the Company’s gross loans receivable portfolio. In estimating the allowance for credit losses, loans with similar risk characteristics are aggregated into pools and collectively assessed. The Company’s loan products have generally the same terms therefore the Company looks to borrower characteristics as a way to disaggregate loans into pools sharing similar risks.

In determining the allowance for credit losses, the Company examined four borrower risk metrics as noted below.

1. Borrower type

2. Active months

3. Prior loan performance

4. Customer Tenure

To determine how well each metric predicts default risk the Company used loss rate data over an observation period of twelve months at the loan level.

The information value was then calculated for each metric. From this analysis management determined the metric that had the strongest predictor of default risk was Customer Tenure. The Customer Tenure buckets used in the allowance for credit loss calculation are:

1.0 to 5 months

2.6 to 17 months

3.18 to 35 months

4.36 to 59 months

5.60+ months

Management will continue to monitor this credit metric on a quarterly basis.

Management estimates an allowance for each Customer Tenure bucket by performing a historical migration analysis of loans in that bucket for the twelve most recent historical twelve-month migration periods. Management considers whether current credit conditions might suggest a change is needed to the allowance for credit losses by monitoring trends in first pay success for new borrowers, 60-89 day delinquencies on a recency basis, percent of loan balances that are paying and percentage of gross loans that are acquired loans. If management determines that historical migration rates should be adjusted to reflect expected credit losses, a qualitative adjustment is made to reflect management's judgment regarding observable changes in recent or expected economic trends and conditions, portfolio composition, or other significant events or conditions that affect the current estimate.

Due to the short term nature of the loan portfolio, forecasted changes in macroeconomic variables such as unemployment levels, general inflation and commodity prices, typically do not have a significant impact on loans outstanding at the end of a particular reporting period, unless those changes are particularly severe and sudden in nature. Therefore, management develops a reasonable and supportable forecast of losses by comparing the most recent six-month loss curves as compared to historical loss curves to see if there are significant changes in borrower behavior that may indicate the historical migration rates should be adjusted. If a change is determined necessary, then the Company has elected to immediately revert to historical experience past the forecast period. As of September 30, 2026 and March 31, 2026, there were no conditions or other factors considered significant enough to warrant a forecast adjustment.

The following table presents a roll forward of the allowance for credit losses for the three and six months ended September 30, 2026 and 2025:

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at September 30, 2026:

2 Recoveries during the three months ended September 30, 2026 and 2025 include $2.4 million and $1.7 million in proceeds related to the recurring sales of charge-offs, respectively. Recoveries during the six months ended September 30, 2026 include $4.9 million and $1.6 million in proceeds related to the recurring sales of charge-offs and bulk sales of charge-offs from prior periods, respectively. Recoveries during the six months ended September 30, 2025 include $4.0 million in proceeds related to the recurring sales of charge-offs. These proceeds are included as a component of Provision for credit losses in the Consolidated Statements of Operations.

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at March 31, 2026:

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at September 30, 2026:

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at March 31, 2026:

The Company elected not to record an allowance for credit losses for accrued interest as outlined in ASC 326-20-30-5A. Loans are placed on nonaccrual status when management determines that the full payment of principal and collection of interest according to contractual terms is no longer likely. The accrual of interest is discontinued when a loan is 61 days or more past the contractual due date. When the interest accrual is discontinued, all unpaid accrued interest is reversed against interest income. While a loan is on nonaccrual status, interest income is recognized only when a payment is received. Once a loan moves to nonaccrual status, it remains in nonaccrual status until it is paid out, charged off or refinanced.

The following table presents unpaid accrued interest reversed against interest income by Customer Tenure for the three and six months ended September 30, 2026 and 2025:

The following table presents the amortized cost basis of loans on nonaccrual status as of the beginning of the reporting period and the end of the reporting period, as well as interest income recognized on nonaccrual loans for the three and six months ended September 30, 2026 and 2025:

As of September 30, 2026 and March 31, 2026, there were no loans receivable 61 days or more past due, not on nonaccrual status, and no loans receivable on nonaccrual status with no related allowance for credit losses.

NOTE 6 –VARIABLE INTEREST ENTITIES

The Company transfers pools of eligible loans receivable to the Warehouse to secure debt for general funding purposes. The Warehouse, a SPE of the Company, is considered a VIE under ASC 810, Consolidation, and is consolidated into the financial statements of the Company as the Company is determined to be the primary beneficiary of the Warehouse.

Debt under the Warehouse Facility is supported by the expected cash flows from the underlying collateralized loans receivable. Collections on these loans receivable are remitted to a restricted cash collection account. As of September 30, 2026, the balance in the restricted cash collection account was $13.0 million. The Company also maintains a restricted cash reserve account, which totaled $1.2 million as of September 30, 2026. Cash inflows from the pledged loans receivable are distributed in accordance with the Credit Agreement’s monthly contractual priority of payments, which include the Warehouse’s lenders and service providers. Additionally, the Warehouse pays a servicing fee to the Company, which is eliminated in consolidation, as the Company continues to service the loans receivable transferred to the Warehouse. Cash inflows remaining after the contractual payments are distributed to the Company, which is permitted under the Credit Agreement.

The following table presents the assets and liabilities of our consolidated VIE:

Historic Tax Credit Investments

The Company's historic tax credit investments are considered VIEs under ASC 810, Consolidation; however, as the Company is not the primary beneficiary of such VIEs, they are not consolidated into the financial statements of the Company.

The Company's maximum exposure to loss as a result of its involvement with these entities is limited to the carrying amount of its investments, including any undrawn commitments and any tax credits previously recognized which remain subject to recapture under applicable program requirements. The Company believes the risk of such recapture is remote. The Company's funding requirements are limited to its invested capital and undrawn commitments for future equity contributions. The Company has no exposure to loss from liquidity arrangements and obligation to purchase assets of these entities.

The following table presents the Company's investments in these unconsolidated entities and related unfunded commitments, which are reported in Other assets, net and Accounts payable and accrued expenses, respectively, in the Consolidated Balance Sheets.

NOTE 7 –LEASES

Accounting Policies and Matters Requiring Management's Judgment

The Company uses the effective interest rate of its revolving facilities to determine the discount rate when evaluating leases under Topic 842. Specifically, Management applies the effective interest rate of its revolving facilities at the end of the prior fiscal year to leases entered into in the following year. For example, the effective interest rate of 7.7% at March 31, 2026 was used as the discount rate when determining the lease type and the present value of lease payments for leases entered into in fiscal 2027.

Based on its historical practice, the Company believes it is reasonably certain to exercise a given option associated with a given office space lease. Therefore, the Company classifies all lease options for office space as “reasonably certain” unless it has specific knowledge to the contrary for a given lease. The Company does not believe it is reasonably certain to exercise any options associated with its office equipment leases.

Periodic Disclosures

The Company's operating leases consist of real estate leases for office space as well as office equipment. Both the branch real estate and office equipment lease terms generally range from three years tofive years, and generally contain options to extend which mirror the original terms of the lease.

As of September 30, 2026 and 2025, the Company had no finance leases.

The following table reports information about the Company's lease cost for the three and six months ended September 30, 2026 and 2025:

The following table reports other information about the Company's leases for the three and six months ended September 30, 2026 and 2025:

The aggregate annual lease obligations as of September 30, 2026 are as follows:

The Company had no leases with related parties as of September 30, 2026 or March 31, 2026.

NOTE 8 –AVERAGE SHARE INFORMATION

The following is a summary of the basic and diluted average common shares outstanding:

Under the treasury stock method, options to purchase 132,987 and 145,591 shares of common stock at various prices were outstanding during the three months ended September 30, 2026 and 2025, respectively, but were not included in diluted shares outstanding because the option exercise price exceeded the market value of the shares.

Under the treasury stock method, options to purchase 144,590 and 154,258 shares of common stock at various prices were outstanding during the six months ended September 30, 2026 and 2025, respectively, but were not included in diluted shares outstanding because the option exercise price exceeded the market value of the shares.

3 Potentially dilutive common shares have been excluded from the weighted average diluted shares outstanding calculation for the three and six months ended September 30, 2025. In accordance with ASC 260-10-45, shares which would otherwise be considered dilutive are deemed anti-dilutive when the entity incurs a loss from continuing operations in the period reported.

NOTE 9 –STOCK-BASED COMPENSATION

Stock Incentive Plans

The Company maintains the 2008 Plan, the 2011 Plan, the 2017 Plan and the 2025 Plan for the benefit of certain non-employee directors, officers, and key employees. Under these plans, a total of 3,750,000 shares of authorized common stock have been reserved for issuance pursuant to grants approved by the Compensation Committee. At September 30, 2026, there were a total of 676,527 shares of common stock remaining available for grant under the 2017 Plan and 2025 Plan and no shares of common stock remaining available for grant under the 2008 or 2011 plan. No awards have been granted under the 2025 Plan as of September 30, 2026.

Stock options granted under these plans have a maximum term of 10 years. Service Options and Restricted Stock granted under these plans typically vest in three equal annual installments, beginning on the first anniversary of the grant date, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement. The performance vesting conditions associated with Performance Shares and Performance Options are further discussed below within this Note 9 to the Consolidated Financial Statements.

Stock-based compensation is recognized as provided under FASB ASC Topic 718-10 and FASB ASC Topic 505-50. FASB ASC Topic 718-10 requires all share-based payments to employees, including grants of employee stock options, to be recognized as compensation expense over the requisite service period (generally the vesting period) in the consolidated financial statements based on their grant date fair values. Stock-based compensation related to restricted stock is based on the number of shares expected to vest and the fair market value of the common stock on the grant date. Stock-based compensation related to stock option awards is based on the number of shares expected to vest and the estimated fair value of the awards on the grant date using the Black-Scholes valuation model. Under the Black-Scholes valuation method, the assumptions used to determine the fair value are expected volatility, expected life, average risk-free rate, and dividend yield, if any. The expected stock price volatility is based on the historical volatility of the Company's common stock for a period approximating the expected life. The expected life represents the period of time that options are expected to be outstanding after the grant date. The risk-free rate reflects the interest rate at grant date on zero coupon U.S. governmental bonds having a remaining life similar to the expected option term.

Long-term Incentive Awards and Non-Employee Director Awards

On December 18, 2024, the Compensation Committee and Board of Directors approved grants of Service Options, Performance Options, Restricted Stock and Performance Shares under the 2017 Plan to certain employee directors, vice presidents, senior vice presidents, and executive officers. Separately, the Compensation Committee approved grants of Restricted Stock to non-employee directors of the Company.

Up to 100% of the shares of restricted stock subject to the 2024 Performance Share awards were eligible to vest based on the achievement of certain performance goals established by the Compensation Committee related to company operational performance metrics during the 2024 Performance Share Measurement Period, for which achievement must be certified by the Compensation Committee. The 2024 Performance Shares were eligible to vest over the 2024 Performance Share Measurement Period, subject to each respective employee’s continued employment at the Company through the last day of the 2024 Performance Share Measurement Period or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

On December 31, 2025,1,031 of the 7,500 2024 Performance Share awards were forfeited as a result of certain company operational performance metrics not being achieved during the 2024 Performance Share Measurement Period. The remaining 6,469 performance shares vested on January 21, 2026 after certification of performance achievement by the Compensation Committee.

Up to 100% of the 2024 Performance Options were eligible to vest based on the achievement of certain performance goals established by the Compensation Committee related to company operational performance metrics during the 2024 Performance Option Measurement Period, for which achievement must be certified by the Compensation Committee. Following certification of achievement, the 2024 Performance Options mainly vest in three equal annual installments, beginning on January 30, 2026, subject to each respective employee’s continued employment at the Company through each applicable vesting date or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

On December 31, 2025,6,132 of 23,500 2024 Performance Options were forfeited as a result of certain company operational performance metrics not being achieved during the 2024 Performance Share Measurement Period. The achievement of the remaining 17,368 performance options was certified by the Compensation Committee on January 21, 2026, and began vesting on January 30, 2026 as described above.

On June 10, 2025, the Compensation Committee and Board of Directors approved grants of Restricted Stock and Performance Shares under the 2017 Plan to certain vice presidents, senior vice presidents, and executive officers. Separately, the Compensation Committee approved grants of Restricted Stock to non-employee directors of the Company.

Up to 100% of the shares of restricted stock subject to the 2025 Performance Share awards will vest, if at all, based on the achievement of a trailing EPS performance target established by the Compensation Committee that is based on EPS for the previous four calendar quarters. The 2025 Performance Shares are eligible to vest over the 2025 Performance Share Measurement Period, subject to each respective employee’s continued employment at the Company through the last day of the 2025 Performance Share Measurement Period (or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement).

The 2025 Performance Shares performance target is set forth below.

On April 15, 2026, the Compensation Committee and Board of Directors approved grants of Service Options, Performance Options, Restricted Stock and Performance Shares under the 2017 Plan to certain employee directors and vice presidents.

Up to 100% of the 2026 Performance Options are eligible to vest based on the achievement of certain performance goals established by the Compensation Committee related to company operational performance metrics during the 2026 Performance Share and Option Measurement Period, for which achievement must be certified by the Compensation Committee. Following certification of achievement, the 2026 Performance Options vest in three equal annual installments, beginning in April 2027, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

The 2026 Performance Shares are eligible to vest based on the achievement of certain performance goals established by the Compensation Committee related to company operational performance metrics during the 2026 Performance Share and Option Measurement Period, for which achievement must be certified by the Compensation Committee. Following certification of achievement, the 2026 Performance Shares vest in April 2027, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

Stock Options

Option activity for the six months ended September 30, 2026 was as follows:

The aggregate intrinsic value reflected in the table above represents the total pre-tax intrinsic value (the difference between the closing stock price on September 30, 2026 and the exercise price, multiplied by the number of in-the-money options that are currently exercisable) that would have been received by option holders had all option holders exercised their options as of September 30, 2026. This amount will change as the market price of the common stock changes. The total intrinsic value and tax benefit of options exercised during the three and six month periods ended September 30, 2026 and 2025 were as follows:

The following are the weighted-average assumptions for the stock options granted during the six months ended September 30, 2026 and 2025:

The weighted-average grant date fair value per share for the three and six months ended September 30, 2026 and 2025 was as follows:

No stock options vested during the six months ended September 30, 2026 and 2025. As of September 30, 2026, total unrecognized stock-based compensation expense related to non-vested stock options amounted to approximately $1.6 million, which is expected to be recognized over a weighted-average period of approximately 1.9 years.

4 Of the 130,053 options outstanding,18,456 are not yet exercisable based solely on fulfilling a service condition and another 33,789 are not yet exercisable based solely on fulfilling performance conditions.

Restricted Stock and Performance Shares

A summary of the status of the Company’s restricted stock as of September 30, 2026, and changes during the six months ended September 30, 2026, are presented below:

The weighted-average grant date fair value per share for the three and six months ended September 30, 2026 and 2025 was as follows:

The fair value of restricted stock vested during the three and six months ended September 30, 2026 and 2025 were as follows:

As of September 30, 2026, there was approximately $6.6 million of unrecognized compensation cost related to unvested restricted stock awards, which is expected to be recognized over the next 1.0 year based on current estimates.

Total Stock-Based Compensation

Total stock-based compensation included as a component of personnel expenses in the Company's Consolidated Statements of Operations during the three and six month periods ended September 30, 2026 and 2025 was as follows:

NOTE 10 –ACQUISITIONS

The Company evaluates each set of assets and activities it acquires to determine if the set meets the definition of a business according to FASB ASC Topic 805-10-55. Acquisitions meeting the definition of a business are accounted for as business combinations while all other acquisitions are accounted for as asset purchases.

The following table sets forth the Company's acquisition activity for the six months ended September 30, 2026 and 2025:

Acquisitions that are accounted for as business combinations typically result in one or more new branches. In such cases, the Company typically retains the existing employees and the branch location from the acquisition. The purchase price is allocated to the tangible assets and intangible assets acquired based upon their estimated fair market values at the acquisition date. The remainder is allocated to goodwill.

Acquisitions that are accounted for as asset purchases are typically limited to acquisitions of loan portfolios. The purchase price is allocated to the tangible assets and intangible assets acquired based upon their estimated fair values at the acquisition date. In an asset purchase, no goodwill is recorded. When the cost of an asset acquisition is less than the fair value of the net assets acquired, the benefit is allocated to nonmonetary long-lived assets acquired on a relative fair value basis. However, any assets for which the subsequent application of GAAP would result in an immediate gain (e.g., financial assets, assets held for sale) are not allocated a portion of the cost below fair value. Any remaining benefit is recorded as a discount on purchase, which is a component of Unearned interest, insurance and fees in the Company's Consolidated Balance Sheets, and is amortized over the life of loans receivable acquired. Unamortized discount on purchases as of September 30, 2026 and March 31, 2026 was $140.2 thousand and $23.1 thousand, respectively.

The Company’s acquisitions include tangible assets (generally loans and furniture and equipment) and intangible assets (generally non-compete agreements, customer lists, and goodwill), both of which are recorded at their fair values, which are estimated pursuant to the processes described below.

Acquired loans are valued at the net loan balance. Given the short-term nature of these loans, generally less than twelve months, and that these loans are priced at current rates, management believes the net loan balances approximate their fair value. Under CECL, acquired loans are included in the reserve calculations for all loan types (excluding TALs). Management includes recent acquisition activity compared to historical activity when considering reasonable and supportable forecasts as it relates to assessing the adequacy of the allowance for expected credit losses. The Company did not acquire any loans that would qualify as PCDs during the six months ended September 30, 2026 and 2025.

Furniture and equipment are valued at the specific purchase price as agreed to by both parties at the time of acquisition, which management believes approximates their fair values.

Non-compete agreements are valued at the stated amount paid to the other party for these agreements, which the Company believes approximates their fair values.

Customer lists are valued with a valuation model that utilizes the Company’s historical data to estimate the value of any acquired customer lists.

The results of all acquisitions are included in the Company’s consolidated financial statements since the respective acquisition date. The pro forma impact of acquisitions as though they had been acquired at the beginning of the periods presented would not have a material effect on the results of operations as reported.

NOTE 11 –INTANGIBLE ASSETS

The following table provides the gross carrying amount and related accumulated amortization of definite-lived intangible assets:

The estimated amortization expense for intangible assets for future fiscal years ended March 31 is as follows: $1.2 million for the remainder of 2027; $0.9 million for 2028; $0.4 million for 2029; $0.1 million for 2030; $0.04 million for 2031; and an aggregate of $0.1 million for the years thereafter.

NOTE 12 –DEBT

Credit Facilities; Senior Notes Redemption

Revolving Credit Facility

On July 22, 2025, the Company entered into athree-year senior secured asset-based credit facility pursuant to a Revolving Credit Agreement (the “Revolving Credit Agreement”), by and among the Company, the lenders named therein (the “Lenders”), and Bank of Montreal, as Administrative Agent and Collateral Agent.

The Revolving Credit Agreement replaced the Company’s Amended and Restated Revolving Credit Agreement, dated as of June 7, 2019, among the Company, the lenders named therein, and Wells Fargo Bank, National Association, as Administrative Agent and Collateral Agent (as amended, the “Prior Credit Agreement”).

Pursuant to the Revolving Credit Agreement, on June 29, 2026, the Company obtained an accordion increase in the amount of $15.0 million to be effected by a new commitment of $15.0 million from Investar Bank, National Association (the "Increasing Lender"), resulting in aggregate commitments of the Lenders and the Increasing Lender of $655.0 million, with an accordion feature that can increase the aggregate commitments by $135.0 million for a total commitment, if the full accordion is borrowed, of $790.0 million (the "Revolving Credit Facility").

At September 30, 2026, $502.5 million was outstanding under the Company's Revolving Credit Facility, not including $816.1 thousand in outstanding standby letters of credit, which include (i) $200.0 thousand related to worker's compensation expiring on October 16, 2027 and (ii) $616.1 thousand related to the Company's investment in captive insurance expiring on March 1, 2027. Both letters of credit automatically extend for one year on their expiration dates. To the extent that the letter of credit is drawn upon, the disbursement will be funded by the Revolving Credit Facility. There are no amounts due related to the letters of credit as of September 30, 2026. At September 30, 2026, subject to a borrowing base formula, the Company may borrow at the rate of one-month SOFR plus 0.10% and an applicable margin of 3.5% with a minimum rate of 4.5%. The Revolving Credit Agreement has a commitment fee of 0.50% per annum on the unused portion of the commitment. Commitment fees on the unused portion of the borrowing totaled $0.4 million and $0.7 million for the six months ended September 30, 2026 and 2025, respectively.

For the six months ended September 30, 2026 and fiscal year ended March 31, 2026, the Company’s effective interest rate, including the commitment fee and amortization of debt issuance costs, was 7.8% annualized and 8.3%, respectively. At September 30, 2026, the unused amount available under the Revolving Credit Facility was $99.8 million. Borrowings under the Revolving Credit Facility have a maturity date of July 22, 2028.

At September 30, 2026, substantially all of the Company’s assets, with the exception of loans receivable pledged to the Warehouse, were pledged as collateral for borrowings under the Revolving Credit Agreement.

Termination of Amended and Restated Revolving Credit Facility

On July 22, 2025, in connection with entry into the Revolving Credit Agreement, the Company terminated the Prior Credit Agreement. The Prior Credit Agreement was scheduled to mature on June 7, 2026 and provided revolving loans in an aggregate commitment of up to $730.0 million.

On September 29, 2025, the Company and its wholly-owned subsidiary, WFC Receivables I, LLC (the “Borrower”), entered into a Credit Agreement (the “Credit Agreement”), by and among the Company, as Servicer, the Borrower, the lenders and agents from time to time parties thereto, Atlas Securitized Products Administration, L.P., as administrative agent for the lenders, Systems & Services Technologies, Inc., a Delaware corporation, as backup servicer, and Wilmington Trust, National Association, a national banking association, as securities intermediary.

The Credit Agreement provides for a revolving $175.0 million warehouse facility (the “Warehouse Facility”) and is secured by certain consumer loan receivables that were directly originated by certain of the Company’s subsidiaries. At September 30, 2026, $89.6 million was outstanding under the Company's Warehouse Facility. As of September 30, 2026, the Company may borrow at the rate of one-month SOFR plus 0.11448% and an applicable margin of 3.00%, with a minimum rate of 4.00%. The Credit Agreement has a commitment fee of 0.50% per annum on the unused portion of the commitment. Commitment fees on the unused portion of the borrowing totaled $0.2 million for the six months ended September 30, 2026.

For the six months ended September 30, 2026, the Company’s effective interest rate, including the commitment fee and amortization of debt issuance costs, was 8.1%. At September 30, 2026, the unused amount available under the Warehouse Facility was $85.4 million. Borrowings under the Warehouse Facility have an expected maturity date of September 29, 2027.

Notes Redemption

On September 27, 2021, we issued $300 million in aggregate principal amount of 7.0% senior notes due November 2026 (the "Notes"). On July 22, 2025, an irrevocable notice of full redemption (the “Notice”) of the Notes was delivered to the holders of the Notes. The Notice called for the redemption of all of the outstanding Notes (the “Redemption”) on August 29, 2025 (the “Redemption Date”) at a redemption price equal to 101.750% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to but not including, the Redemption Date. The aggregate principal amount of the Notes redeemed was $168.3 million. The Redemption was made in accordance with the terms and conditions of the Notes and the indenture governing the Notes. As a result of the Redemption, the Company recognized an additional $3.7 million in interest expense, for which $3.0 million represents an early redemption premium and $0.7 million represents the write-off of the remaining unamortized debt issuance costs associated with the Notes.

During the six months ended September 30, 2025 and prior to the Redemption, the Company repurchased and extinguished $17.0 million of its Notes, net of $0.1 million unamortized debt issuance costs related to the extinguished debt, on the open market for a reacquisition price of $17.0 million.

For each of the three and six months ended September 30, 2025, the Company recognized a $3.7 million loss on extinguishment. In accordance with ASC 470, the Company recognized the loss on extinguishments as a component of interest expense in the Company's Consolidated Statements of Operations.

Debt Covenants

Revolving Credit Facility

The Revolving Credit Agreement contains a number of affirmative and negative covenants that, among other things, restrict our ability to incur liens, incur indebtedness, pay dividends and repurchase or redeem capital stock, make certain restricted payments, merge or consolidate, dispose of assets, make acquisitions or other investments, redeem or prepay subordinated debt, amend subordinated debt documents, make changes in the nature of its business, and engage in transactions with affiliates. The agreement allows the Company to incur subordinated debt that matures after the maturity date of the Revolving Credit Agreement and that contains specified subordinated terms, subject to limitations on amount imposed by the financial covenants under the Revolving Credit Agreement.

On May 22, 2026, the Company entered into a Consent and Limited Modification to Fixed Charge Ratio (the "Modification") with Bank of Montreal, as Administrative Agent and Collateral Agent, and the Required Lenders party to the Revolving Credit Agreement dated as of July 22, 2025 (as amended or otherwise modified from time to time), by and among the Company, the lenders from time to time party thereto, and BMO, as Administrative Agent and Collateral Agent.

Pursuant to Section 8.7(b) of the Revolving Credit Agreement, the Company and its Restricted Subsidiaries are required to maintain a ratio of Net Income Available for Fixed Charges to Fixed Charges (the "Financial Covenant") of not less than 2.25 to 1.0 as of the end of each fiscal quarter, calculated for the period of four consecutive fiscal quarters then ending. The Modification provides for a limited, temporary modification of the Financial Covenant as follows:

i.2.20 to 1.0 as of the fiscal quarter ending March 31, 2026;

ii.2.10 to 1.0 as of the fiscal quarter ending June 30, 2026; and

iii.2.15 to 1.0 as of the fiscal quarter ending September 30, 2026.

Commencing with the fiscal quarter ending December 31, 2026, and for all fiscal quarters thereafter, the Financial Covenant shall revert to its original level of not less than 2.25 to 1.0, without regard to the limited modification set forth in the Modification.

Except as expressly modified by the Modification, the Revolving Credit Agreement remains in full force and effect in accordance with its current terms.

In addition, the Revolving Credit Agreement requires the Company to (i) keep and maintain a Consolidated Net Worth of $325.0 million, (ii) not permit the aggregate unpaid principal amount of Total Debt to exceed 225.0% of Consolidated Adjusted Net Worth, and (iii) as of the end of each calendar month maintain an Asset Quality Indicator (Consolidated) of less than or equal to 26.0%. Each of the capitalized terms used and not defined herein have the meanings set forth in the Revolving Credit Agreement.

The Company was in compliance with these covenants at September 30, 2026, after giving effect to the Modification. The Company does not believe that these covenants will materially limit its business and expansion strategy.

The Revolving Credit Agreement also contains customary events of default (subject to certain materiality thresholds and cure periods), including among others, (a) non-payment, (b) non-compliance with covenants, (c) a breach of a representation or warranty, (d) an insolvency event involving the Company, (e) a change in control of the Company, (f) failure of the Company to maintain certain financial covenants, (g) cross-default to other debt, (h) invalidity of subordination provisions of subordinated debt, (i) the occurrence of certain regulatory events (including an order or judgment entered against the Company with respect to the financial receivables generally or any category of receivables that is material to the business) which remains unvacated, undischarged, unbonded or unstayed by appeal or otherwise for a period of 60 days from the date of its entry and is reasonably likely to cause a material adverse change, and (j) payment defaults resulting in acceleration of securitizations or warehouse facilities that remain continuing for more than 30 days.

The Credit Agreement contains affirmative and negative covenants, including covenants that generally restrict the ability of the Company and the Borrower to, among other things, incur or guarantee indebtedness, incur liens, pay dividends and repurchase or redeem capital stock, engage in mergers and consolidations, make acquisitions or other investments, or fund benefit plans. The Company’s financial covenants under the Credit Agreement include: (i) a minimum tangible net worth of $305.0 million; (ii) a maximum ratio of debt to tangible net worth of 2.25 to 1.0 as of the end of each fiscal quarter; (iii) a minimum liquidity amount of $35.0 million; and (iv) a minimum of unrestricted cash and cash equivalents of $5.0 million. The Credit Agreement also contains covenants that require the Company, as Servicer, with respect to any collection period to maintain certain delinquency ratios, payment ratios and annualized net charge-off ratios. A failure to maintain such ratios may result in a Level I Trigger Event, Level II Trigger Event, or Level III Trigger Event. Each of the capitalized terms used and not defined herein have the meanings set forth in the Credit Agreement.

The Company was in compliance with these covenants at September 30, 2026 and does not believe that these covenants will materially limit its business and expansion strategy.

The Credit Agreement also contains customary events of default (subject to certain materiality thresholds and cure periods), including among others: (a) non-payment, (b) non-compliance with covenants, (c) failure of the Administrative Agent to maintain a first-priority perfected security interest in any material portion of the collateral (subject to permitted liens), (d) the occurrence of a servicer termination event, (e) a breach of a representation or warranty, (f) an insolvency event involving the Company, the Borrower, or the Originators (as defined therein), (g) a change in control of the Company or the Borrower, (h) an event of default under a material financing agreement of the Company, the Borrower, or the Originators, (i) failure of the Company, as Servicer, to maintain certain financial covenants, and (j) the Company, the Borrower, or the Originators have one or more final non-appealable judgments entered against it by a court of competent jurisdiction in excess of the specified monetary thresholds. The remedies for such events of default are also customary for this type of transaction and include acceleration of the Borrower’s outstanding obligations under the Credit Agreement.

Debt Maturities

The aggregate annual maturities of the Company's debt arrangements for future fiscal years ended March 31 are as follows:

NOTE 13 –INCOME TAXES

At both September 30, 2026 and March 31, 2026, the Company had $0.5 million of total gross unrecognized tax benefits, including interest. Of these totals, approximately $0.4 million represents the amount of net unrecognized tax benefits that are permanent in nature and, if recognized, would affect the annual effective tax rate for each period. The Company’s continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. The Company had approximately $72.6 thousand accrued for gross interest as of September 30, 2026, and accrued $18.1 thousand during the six months ended September 30, 2026.

Investment in HTC was $34.1 million and $10.1 million as of September 30, 2026 and March 31, 2026, respectively, which is included as a component of Other assets, net in the Consolidated Balance Sheets. The Company recognized negative amortization from these investments of $0.3 million during the three months ended September 30, 2026, and amortization of $3.2 million during the three months ended September 30, 2025, respectively, in income tax expense. During the six months ended September 30, 2026 and 2025, the Company recognized amortization from these investments of $0.8 million and $6.6 million, respectively, in income tax expense. For the three months ended September 30, 2026 and 2025, the Company recognized a tax expense and a tax benefit from these investments of $0.2 million and $3.6 million, respectively, and a tax benefit of $1.1 million and $7.4 million for the six months ended September 30, 2026 and 2025, respectively, in income tax expense and in Income taxes receivable in the Consolidated Statements of Cash Flows. The negative amortization and tax expense in the current quarter are due to a reduction to the final fiscal year 2026 tax credit that is being treated as a discrete adjustment in the current year quarter. The Company did not recognize any non-tax related activity or have any significant modifications in the investments during the current period.

The Company is subject to U.S. income taxes, as well as taxes in various other state and local jurisdictions. With the exception of a few states, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2022, although carryforward attributes that were generated prior to 2022 may still be adjusted upon examination by the taxing authorities if they either have been or will be used in a future period.

The Company’s effective income tax rate was 25.0% for the three months ended September 30, 2026 compared to a negative 27.5% for the prior year quarter. The change was primarily the result of a settlement with various taxing authorities that resulted in an increase in the reserve under ASC 740 (unrecognized tax positions) which was treated as a discrete item in the prior year quarter. This was partially offset by an increase in disallowed executive compensation under Section 162(m) in the current quarter and a reduction to the final fiscal year 2026 tax credit that is being treated as a discrete adjustment in the current year quarter.

NOTE 14 –COMMITMENTS AND CONTINGENCIES

The Company has been named in 14 consumer class-action lawsuits arising out of a cyber incident that the Company discovered in August 2026. The Company continues to evaluate this matter and expects these lawsuits to be consolidated into a single class-action litigation. The Company has determined pursuant to ASC 450 that a loss is reasonably possible with respect to these lawsuits. Because the matters are in their early stages, the Company is currently unable to reasonably estimate the amount of loss or range of possible loss. Accordingly, no loss contingency has been accrued as of September 30, 2026. The Company carries insurance coverage for these claims. Based on the information available to the Company at this time, net of insurance, the Company does not believe that any potential losses arising from these claims will be material to the Company’s results of operations or financial conditions.

In addition, from time to time the Company is involved in other litigation matters relating to claims arising out of its operations in the normal course of business.

Estimating an amount or range of possible losses resulting from litigation, government actions and other legal proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, may involve fines, penalties or damages that are discretionary in amount, involve a large number of claimants or significant discretion by regulatory authorities, represent a change in regulatory policy or interpretation, present novel legal theories, are in the early stages of the proceedings, are subject to appeal or could result in a change in business practices. In addition, because most legal proceedings are resolved over extended periods of time, potential losses are subject to change due to, among other things, new developments, changes in legal strategy, the outcome of intermediate procedural and substantive rulings and other parties’ settlement posture and their evaluation of the strength or weakness of their case against us. For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, any currently pending claims. Based on information currently available, the Company does not believe that any reasonably possible losses arising from currently pending legal matters will be material to the Company’s results of operations or financial conditions. However, in light of the inherent uncertainties involved in such matters, an adverse outcome in one or more of these matters could materially and adversely affect the Company’s financial condition, results of operations or cash flows in any particular reporting period.

NOTE 15 –SUBSEQUENT EVENTS

On October 28, 2026, in accordance with its share repurchase program, the Company, after approval by the Audit and Compliance Committee, repurchased 88,324 shares for $15.0 million from Prescott Associates L.P. (the "Seller") in a privately negotiated transaction. The Seller is an affiliate of Prescott General Partners, LLC, who, along with its affiliates, beneficially own approximately 42.2% of the Company's common stock as of October 28, 2026. The price per share was $169.83, which was the closing market price at October 27, 2026.

Management is not aware of any other significant events occurring subsequent to the balance sheet date that would have a material effect on the financial statements thereby requiring adjustment or disclosure.