What changed in this filing

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Item 3. Legal Proceedings

2026-03-16 compared with 2025-03-12 · 43 added, 64 removed, 83 unchanged (56% of the section changed)

7 unchanged sentences

to consumer claims, which we routinely contest or settle (for immaterial amounts) depending on the particular circumstances of each case.

Following our filing of a

complaint for a deficiency judgment in the Superior Court at Waterbury, Connecticut, the defendant filed a cross-claim on October 16,

2019 alleging that our deficiency notices were not compliant with Connecticut law, and seeking relief on behalf of a class of Connecticut

obligors whose vehicles we had repossessed.

The complaint seeks primarily damages, injunctive relief, waiver of contract deficiencies,

and attorney fees and interest.

The defendant’s contract provided for resolution of disputes exclusively by arbitration, and exclusively

on an individual basis, not a class basis.

Nevertheless, in August 2021, the court denied our motion to compel arbitration, without opinion.

In April 2024 a motion for certification of a class was filed.

Prior to the motion being ruled upon, summary judgment was granted in our

favor, disposing of the claims against CPS.

An appeal of the summary judgment ruling was filed on October 25, 2024 and a cross appeal

of the denial of the motion to compel arbitration was filed on October 31, 2024.

Wage and Hour Claim.

On September 24, 2018, a former employee filed a lawsuit against us in the Superior Court of Orange County, California, alleging that

we incorrectly classified our sales representatives as outside salespersons exempt from overtime wages, mandatory break periods and certain

other employee protective provisions of California and federal law.

The complaint sought injunctive relief, an award of unpaid wages,

liquidated damages, and attorney fees and interest.

The plaintiff purported to act on behalf of a class of similarly situated employees

and ex-employees.

We believe that our compensation practices with respect to our sales representatives are compliant with applicable law.

In August 2023, the parties settled by agreement the claims of the plaintiff and a California settlement class for $1.1 million.

The settlement

was approved by the court on October 9, 2024.

Under the settlement, the Company paid, after September 30, 2024, $1.1 million to the settlement

administrator.

be no assurance as to the outcomes of the matters described or referenced above.

We record at each measurement date, most recently as

of December 31, 2024, our best estimate of probable incurred losses for legal contingencies, including the matters identified above.

amount of losses that may ultimately be incurred cannot be estimated with certainty.

However, based on such information as is available

to us, we believe that the range of reasonably possible losses for the legal proceedings and contingencies we face, including those described

or identified above, as of December 31, 2024 does not exceed $3.2 million.

be no assurance as to the outcomes of the matters described above.

We record at each measurement date our best estimate of probable incurred

losses for legal contingencies, if any.

The amount of losses that may ultimately be incurred cannot be estimated with certainty.

based on such information as is available to us, the Company is not currently a party to any such material legal proceedings.

Accordingly, we believe that

the ultimate resolution of such legal proceedings and contingencies should not have a material adverse effect on our consolidated financial

We note, however, that in light of the uncertainties inherent in contested proceedings there can be no assurance that the ultimate

resolution of these matters will not be material to our operating results for a particular period, depending on, among other factors,

the size of the loss or liability imposed and the level of our income for that period.

the ultimate resolution of legal proceedings should not have a material adverse effect on our consolidated financial condition.

however, that in light of the uncertainties inherent in contested proceedings there can be no assurance that the ultimate resolution of

these matters will not be material to our operating results for a particular period, depending on, among other factors, the size of the

loss or liability imposed and the level of our income for that period.

Mine Safety Disclosures

14 unchanged sentences

53, has been President since December 2022, Chief Operating Officer since February 2019, and our Chief Legal Officer since March

Prior to that, he was our Executive Vice President since March 2014, Senior Vice President – General Counsel since March 2013,

Senior Vice President and Corporate Counsel since May 2009 and our Vice President- Legal since joining the Company in November of 2001.

Prior to that, he was our Executive Vice President since March 2014, Senior Vice President – General Counsel since

March 2013, Senior Vice President and Corporate Counsel since May 2009 and our Vice President- Legal since joining the Company in

November of 2001.

Lavin was previously engaged as an associate at a large law firm and a spin off start up law firm.

6 unchanged sentences

Corporation, from 1989 to 1997.

Robert Riedl, 62, rejoined the Company as

the Senior Executive Vice President, Chief Risk Officer in August 2025.

From 2021 to July 2025, he was Chief Investment Officer at Lobel

Financial Corporation, a family-owned auto finance company.

Since 2017 he has been a partner at a Greendoor Partners, a boutique investment

and advisory firm.

He initially joined CPS in 2003 through 2015 and held a number of different senior positions within the Company including

Chief Operating Officer, Chief Investment Officer, Chief Financial Officer and Senior Vice President of Risk Management.

Previously, from

2000 to 2002, Mr.

Riedl was a Principal at Northwest Capital Appreciation, a private equity firm.

For a year prior to joining Northwest

Riedl served as Senior Vice President for one of its portfolio companies, SLP Capital.

Riedl was an investment banker

for ContiFinancial Services, Jefferies & Company and PaineWebber from 1986 to 1999.

Robinson, 63,

has been Executive Vice President of Sales and Originations since December 2022.

Prior to that she was Senior Vice President of Sales

and Originations from June 2020 to December 2022 and Senior Vice President of Originations from April 2007 to June 2020.

Prior to that,

she held the position of Vice President of Originations since August 1998.

She joined the Company in June 1991 as an Operations Specialist,

and held a series of successively more responsible positions.

Previously, Ms.

Robinson held an administrative position at Greco &

Christopher Terry,

9 unchanged sentences

was previously a branch manager with Norwest Financial from 1990 to October 1994.

Robinson, 62,

has been Executive Vice President of Sales and Originations since December 2022.

Prior to that she was Senior Vice President of Sales

and Originations from June 2020 to December 2022 and Senior Vice President of Originations from April 2007 to June 2020.

Prior to that,

she held the position of Vice President of Originations since August 1998.

She joined the Company in June 1991 as an Operations Specialist,

and held a series of successively more responsible positions.

Previously, Ms.

Robinson held an administrative position at Greco &

Michele Baumeister ,

5 unchanged sentences

Baumeister was previously a personal banker with Western Financial.

April Crisp , 38, has been the Senior Vice

President of Compliance and Regulatory Affairs since June 2023.

Prior to that, she was the Vice President of Legal from August 2016 to

June 2023, and the Assistant Vice President of Legal from November 2013 to August 2016.

Crisp is a California barred attorney.

Charles Gonel , 45,

4 unchanged sentences

Prior to joining CPS, he was a Quality Assurance Analyst with AT&T

has been Senior Vice President – Business Development since June 2020.

Prior to that he was Senior Vice President – Program

Development from March 2019 to June 2020, Senior Vice President – Marketing from March 2014 to March 2019 , and Vice President –

Marketing from April 2010 to March 2014.

He joined the Company in April 1996 as a loan officer, held a series of successively more responsible

positions, and was promoted to Vice President - Originations in June 2007.

Harton was previously a branch manager with American General

Finance from 1990 to March 1996.

Noel Jackson, 54, has

been the Senior Vice President of Asset Recovery since May 2025.

Prior to that, she was the Vice President of Asset Recovery from December

2021 to May 2025, the Vice President of Collections from April 2019 to December 2021 and the Vice President of Asset Recovery from April

2017 to April 2019.

Jackson was previously an Executive Director at a non-profit organization.

Catrina Ralston , 50,

25 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 3. Legal Proceedings