What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-03-10 compared with 2025-03-17 · 409 added, 271 removed, 586 unchanged (54% of the section changed)

6 unchanged sentences

Executive Overview

We are a financial holding company owning a branchless OCC nationally chartered bank.

We are a financial holding company owning Newtek Bank - a branchless OCC nationally chartered bank.

In 2023, we converted to a financial holding company from a BDC and a non-bank lender (see below).

1 unchanged sentence

We offer lending products, FDIC insured deposit products and services, payments processing, payroll services and insurance brokerage services.

We source our business through our alliance partner network and our marketing database, which is facilitated through our NewTracker® platform.

We source our business through our NewtekOne.com and NewtekBank.com web sites, our alliance partner network and our marketing database, which is facilitated through our patented NewTracker® platform.

Our loan products include SBA 7(a), ALP, SBA 504, and traditional C&I and CRE bank loans.

3 unchanged sentences

We record CECL reserves on loans held for investment at amortized cost, which for unguaranteed SBA 7(a) loans exceeds 6%.

For SBA7(a) loans, we hold the unguaranteed portion and sell the portion guaranteed by the SBA for premiums that typically exceed 10%, depending on loan characteristics and market conditions.

For SBA7(a) loans, we hold the unguaranteed portion and sell portions guaranteed by the SBA, within approximately 180 days of origination (or we may hold guaranteed portions for longer periods), for premiums that have historically exceeded 10%, depending on loan characteristics and market conditions.

Unlike traditional financial and bank holding companies, the majority of our income is driven and influenced by noninterest income, specifically gains on sales and market value adjustments on loans.

1 unchanged sentence

We fund our activities at Newtek Bank primarily through the aforementioned deposit products.

We offer loans outside of our bank (primarily ALP loans) that are initially funded with lines of credit and hedged until a sufficient volume is attained at which time the loans are securitized.

We have also offered loans outside of our bank (primarily ALP loans that have been funded by our JVs and our non-bank subsidiary Newtek ALP Holdings) that have been initially funded with capital and lines of credit and hedged until a sufficient volume is attained at which time the loans are securitized.

We are required by law to hold risk retention in securitization transactions, and the majority of our interests in securitizations are designed to absorb first loss on the loans held in the securitization trusts.

Historically, we have participated in joint ventures as additional sources of funding and risk diversification for our ALP loans, and these joint ventures have also securitized their loans.

Prior to July 1, 2024, the Company originated ALP loans with the intent to sell the loans to a JV.

While the Company may continue to source JV partners to participate in the ALP, during the third quarter of 2024, we made the decision to originate with the intent to securitize ALP loans with our subsidiary Newtek ALP Holdings as the originator and sponsor.

The Company could also originate ALP loans (i.e., long amortizing C&I loans) designated as HFI.

We have also continued to actively issue bonds in the public and private capital markets.

We are subject to the regulation and supervision of the Federal Reserve and the Federal Reserve Bank of Atlanta.

In addition Newtek Bank is regulated by the OCC and we are required to follow SBA rules and guidelines in the origination and servicing of our SBA loans.

In addition Newtek Bank is regulated by the OCC and we are required to follow SBA rules and guidelines in the origination, servicing and sale of our SBA loans.

Complying with this level of regulation requires investments in technology and process and personnel costs.

Conversion to a Financial Holding Company

As of January 6, 2023, we are a financial holding company that, together with our consolidated subsidiaries, provides a wide range of business and financial solutions under the Newtek ® and NewtekOne ® brands to the independent business owner (SMB) market.

As of January 6, 2023, we became a financial holding company that, together with our consolidated subsidiaries, provide a wide range of business and financial solutions under the Newtek ® and NewtekOne ® brands to the independent business owner (SMB) market.

Effective January 6, 2023, following authorization by our shareholders, we withdrew our previous election to be regulated as a BDC under the 1940 Act.

Contemporaneously with withdrawing our election to be regulated as a BDC, on January 6, 2023, we completed the Acquisition of NBNYC, a national bank regulated and supervised by the OCC, pursuant to which we acquired from NBNYC’s shareholders all of the issued and outstanding stock of NBNYC.

NBNYC has been renamed Newtek Bank and has become our wholly owned bank subsidiary.

As a result of the Acquisition, we are now a financial holding company subject to the regulation and supervision of the Federal Reserve and the Federal Reserve Bank of Atlanta.

We no longer qualify as a RIC under Subchapter M of the Code for federal income tax purposes and no longer qualify for accounting treatment as an investment company.

As a result, in addition to Newtek Bank and its consolidated subsidiary SBL, the following former portfolio companies and subsidiaries are consolidated non-bank subsidiaries in our financial statements as of December 31, 2024:

In addition, as a result of commitments made to the Federal Reserve, we divested of NTS on January 2, 2025, and, as a result, t he Company has reported NTS as Held for Sale as of December 31, 2024.

See “ Item 1A.

Risk Factors – Risks Related to Operation as a Financial Holding Company – We are subject to extensive regulation and supervision as a financial holding company, which may adversely affect our business.” See NOTE 9—ASSETS AND LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE.

NBNYC was renamed Newtek Bank and became our wholly owned bank subsidiary.

As a result of the Acquisition, we became a financial holding company subject to the regulation and supervision of the Federal Reserve and the Federal Reserve Bank of Atlanta.

We no longer qualified as a RIC under Subchapter M of the Code for federal income tax purposes and no longer qualified for accounting treatment as an investment company.

In addition, as a result of commitments made to the Federal Reserve, we divested of NTS on January 2, 2025.

Refer to NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp.

Effective January 13, 2023, we filed Articles of Amendment amending our Charter to change the name of the Company to “NewtekOne, Inc.”

On April 13, 2023, the Company, NSBF and the SBA entered into the Wind-down Agreement, pursuant to which NSBF is winding-down its operations and NSBF’s SBA 7(a) pipeline of new loans was transitioned to Newtek Bank.

During this wind-down process, NSBF continues to own the SBA 7(a) loans and PPP Loans currently in its SBA loan portfolio to maturity, liquidation, charge-off or (subject to SBA’s prior written approval) sale or transfer.

During this wind-down process, NSBF continues to own the SBA 7(a) loans in its loan portfolio to maturity, liquidation, charge-off or (subject to SBA’s prior written approval) sale or transfer.

SBL is servicing and liquidating NSBF’s SBA loan portfolio pursuant to an SBA approved lender service provider agreement.

In addition, during the wind-down process, NSBF is subject to minimum capital requirements established by the SBA, required to continue to maintain certain amounts of restricted cash available to meet any obligations to the SBA, has restrictions on its ability to make dividends and distributions to the Company, and remains liable to the SBA for post-purchase denials and repairs on the guaranteed portions of SBA 7(a) loans originated and sold by NSBF, from the proceeds generated by NSBF’s SBA loan portfolio.

The Company has guaranteed certain of NSBF’s obligations to the SBA and has funded a $10.0 million account at Newtek Bank to secure these potential obligations.

The Company has guaranteed certain of NSBF’s obligations to the SBA and has funded a $10.0 million account to secure these potential obligations.

Historical Business Regulation and Taxation

Prior to January 6, 2023, we operated as an internally managed non-diversified closed-end management investment company that elected to be regulated as a BDC under the 1940 Act.

As a BDC under the 1940 Act we were not permitted to acquire any asset other than assets of the type listed in Section 55(a) of the 1940 Act, which are referred to as qualifying assets, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company’s total assets, and we were not permitted to issue senior securities unless the ratio of our total assets (less total liabilities other than indebtedness represented by senior securities) to our total indebtedness represented by senior securities plus preferred stock, if any, was at least 150%.

As of December 31 2022, our asset coverage was 169%.

Although we are no longer regulated as a BDC, certain covenants in our outstanding 2026 Notes require us to maintain an asset coverage of at least 150% as long as the 2026 Notes are outstanding.

See “Item 1A.

Risk Factors – Risks Related to our Outstanding Indebtedness – We are subject to 150% asset coverage requirements due to covenants contained in certain of our outstanding debt.”

Additionally, prior to January 6, 2023, due to our status as a BDC, we elected to be treated as a RIC for U.S.

2 unchanged sentences

federal income taxes at corporate rates on any ordinary income or capital gains that we distributed to our shareholders as dividends.

To maintain our qualification as a RIC for U.S.

federal income tax purposes, we were required to, among other things, meet certain source-of-income and asset diversification requirements (as described below).

In addition, in order to obtain tax benefits applicable to an entity treated as a RIC for U.S.

federal income tax purposes, we were required to distribute to our shareholders, for each taxable year, at least 90% of our “investment company taxable income,” which is generally our ordinary income plus the excess of realized net short-term capital gains over realized net long-term capital losses.

The Company and its subsidiaries no longer qualify as a RIC for U.S.

federal income tax purposes and filed a consolidated U.S.

federal income tax purposes and files a consolidated U.S.

federal income tax return beginning with the 2023 fiscal year.

1 unchanged sentence

Taxable income is generally calculated under applicable sections of the Internal Revenue Code of 1986, as amended (the “Code”), including Sections 581 through 597 that apply specifically to financial institutions.

Some modifications are required by state law and the 2017 tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act").

Among other things, the Tax Act (i) established a new, flat corporate federal statutory income tax rate of 21%, (ii) eliminates the corporate alternative minimum tax and allowed the use of any such carryforwards to offset regular tax liability for any taxable year, (iii) limited the deduction for net interest expense incurred by U.S.

corporations, (iv) allowed businesses to immediately expense, for tax purposes, the cost of new investments in certain qualified depreciable assets, (v) eliminated or reduced certain deductions related to meals and entertainment expenses, (vi) modified the limitation on excessive employee remuneration to eliminate the exception for performance-based compensation and clarified the definition of a covered employee and (vii) limited the deductibility of deposit insurance premiums.

There can be no assurance as to the actual effective rate because it will be dependent upon the nature and amount of future income and expenses as well as actual investments generating investment tax credits and transactions with discrete tax effects.

From 2012 through December 31, 2022, NSBF, a wholly-owned subsidiary, was consistently the largest non-bank SBA 7(a) lender in the U.S.

Some modifications are required by state law and the One Big Beautiful Bill Act (“OBBBA”) that was enacted in the U.S on July 4, 2025.

The OBBBA includes significant tax related provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in the Company's fiscal year 2025 and others to be implemented through 2027.

There can be no assurance as to the actual effective income tax rates impacting the amounts and timing of cash flows and the amounts of income tax expense recorded by the Company, because such rates will be dependent upon the nature and amount of future income and expenses as well as actual investments generating investment tax credits and transactions with discrete tax effects.

From 2012 through December 31, 2022, NSBF was consistently the largest non-bank SBA 7(a) lender in the U.S.

based on dollar volume of loan approvals, and, as of December 31, 2022, was the third largest SBA 7(a) lender in the United States.

Currently, Newtek Bank is ranked as the largest SBA 7(a) lender based on dollar volume of loans approved.

Currently, Newtek Bank is ranked as the third largest SBA 7(a) lender based on dollar volume of loans approved.

Historically, NSBF structured its loans so that it could both sell the government guaranteed portions of SBA 7(a) loans and securitize the unguaranteed portions.

This structure generally allowed NSBF to recover its capital and earn excess capital on each loan, typically within a year.

Pursuant to the Wind-down Agreement described above, in April 2023 NSBF transitioned its SBA 7(a) loan originations to Newtek Bank and is in the process of winding down its operations and will continue to own the 7(a) Loans and PPP Loans in its SBA loan portfolio to maturity, liquidation, charge-off or (subject to SBA’s prior written approval) sale or transfer.

Additionally, we and our subsidiaries have historically provided a wide range of business and financial solutions to independent business owner relationships, including Business Lending, which includes SBA 7(a) loans, SBA 504 loans and our ALP loans, Electronic Payment Processing, Managed Technology Solutions, Accounts Receivable and Inventory Financing, personal and commercial lines Insurance Services, and Payroll and Benefits Solutions to independent business owner relationships nationwide across all industries.

With the divestiture of NTS, we will no longer provide Managed Technology Solutions to our clients, however, we anticipate referring our clients to IPM for its offering of Managed Technology Solutions, and earning a finders fee pursuant to a referral promotion agreement.

Pursuant to the Wind-down Agreement described above, in April 2023 NSBF transitioned its SBA 7(a) loan originations to Newtek Bank and is in the process of winding down its operations and will continue to own the 7(a) Loans in its loan portfolio to maturity, liquidation, charge-off or (subject to SBA’s prior written approval) sale or transfer.

Additionally, we and our subsidiaries provide a wide range of business and financial solutions to independent business owner relationships, including Business Lending, which includes SBA 7(a) loans, SBA 504 loans, ALP loans, C&I loans, CRE loans and ABL loans;

Electronic Payment Processing, personal and commercial lines Insurance Services, and Payroll and Benefits Solutions to independent business owner relationships nationwide across all industries.

With the divestiture of NTS, we no longer provide Managed Technology Solutions to our clients, however, we are currently referring our clients to IPM for its offering of Managed Technology Solutions and can earn a finder’s fee pursuant to a referral promotion agreement.

We support the operations of our subsidiaries by providing access to our proprietary and patented technology platform, including NewTracker ® , our patented prospect management software.

We have historically defined independent business owners (SMBs) as companies having revenues of $1 million to $100 million, and we have generally estimated the SMB market to be over 34 million businesses in the United States.

We have historically made loans and provided business and financial solutions to the SMB market through NSBF and our controlled portfolio companies (now subsidiaries).

In addition, we have begun to offer the Newtek Advantage ® , the One Dashboard for All of Your Business Needs ® , which provides independent business owners with instant access to a team of NewtekOne business and financial solutions experts in the areas of Business Lending, Electronic Payment Processing, personal and commercial lines Insurance Services and Payroll and Benefits Solutions.

Moreover, we believe the Newtek Advantage provides our independent business owner clients with analytics on their businesses, as well as transactional capabilities, including free unlimited document storage, free real-time updated traffic analytics, free real-time credit card processing and chargeback batch information for merchant solutions clients and the ability for PMT clients to make payroll directly from the Newtek Advantage business portal.

We make loans and provide business and financial solutions to the SMB market through our bank and non-bank subsidiaries.

In addition, we now offer the Newtek Advantage ® , the One Dashboard for All of Your Business Needs ® , which provides independent business owners with instant access to a team of NewtekOne business and financial solutions experts in the areas of Business Lending, Electronic Payment Processing, personal and commercial lines Insurance Services and Payroll and Benefits Solutions.

Moreover, the Newtek Advantage provides our independent business owner clients with analytics on their businesses, as well as transactional capabilities, including free unlimited document storage, free real-time updated traffic analytics, free real-time credit card processing and chargeback batch information for merchant solutions clients and the ability for PMT clients to make payroll directly from the Newtek Advantage business portal.

The Company has originated loans under its ALP since 2019.

These loans have terms between 10 and 25 years, bear fixed interest rates that reset every five years, and have prepayment penalties.

The criteria evaluated in underwriting ALP loans and the terms of these loans have been generally consistent over the ALP’s existence.

Prior to July 1, 2024, the Company originated ALP loans with the intent to sell the loans to a JV.

For example, during the second quarter of 2025, Newtek ALP Holdings closed a securitization backed by $216.6 million of ALP loans.

The Company could also originate ALP loans designated as HFI.

Following the Acquisition, there can be no assurance regarding our continued lending prospects or operations as a financial holding company.

4 unchanged sentences

Newtek Bank has been granted PLP status and is authorized to place SBA guarantees on loans without seeking prior SBA review and approval.

Being a national lender with PLP status allows Newtek Bank to expedite the origination of loans since Newtek Bank is not required to present applications to the SBA for concurrent review and approval.

Being a national lender with PLP status allows Newtek Bank to expedite the origination of SBA 7(a) loans since Newtek Bank is not required to present applications to the SBA for concurrent review and approval.

The loss of PLP status would adversely impact our marketing efforts and ultimately our loan origination volume, which would negatively impact our results of operations.

4 unchanged sentences

We have observed and continue to observe commodity inflation, rising interest rates, unrelated bank failures and declines in depositor confidence in certain types of depository institutions.

Additionally geopolitical events, such as trade disruptions, tariffs, the ongoing war between Russia and Ukraine, conflict in the Middle East, rising tensions in Asia, and elements of political, economic and financial market instability in the United States, the United Kingdom, the European Union and China have led to increased economic uncertainty.

One or more of these factors may contribute to increased market volatility, may have long term effects in the United States and worldwide financial markets, and may cause economic uncertainties or deterioration in the United States and worldwide.

Additionally, in the event that the U.S.

economy enters into a protracted recession, it is possible that the businesses and industries in which we and our customers operate and to which we lend to could experience deterioration, which could ultimately lead to difficulty in meeting debt service requirements and an increase in defaults.

While we are not seeing signs of an overall, broad deterioration in the economy at this time, there can be no assurance that the performance of certain of our subsidiaries and our current and prospective borrowers will not be negatively impacted by economic conditions, which could have a negative impact on our future results.

For the fiscal year ended December 31, 2024, we generated income in the form of interest, net gains on the sales of loans originated (which primarily include sales of SBA 7(a) and ALP loans) and related servicing assets on such sales, dividends, electronic payment processing income, technology and IT support income, servicing income, and other fee income generated by loan originations and by our subsidiaries.

In addition, the conflicts in the Middle East and the war between Russia and Ukraine, and resulting market volatility and impacts on energy prices, could adversely affect our business, financial condition and results of operations, as well as the financial condition of our borrowers.

The ongoing conflicts have negatively affected the global economy and business activity and could have a material adverse effect on our business, financial condition, cash flows and results of operations, as well as those of our borrowers.

The severity and duration of conflicts and their impact on global economic and market conditions are impossible to predict.

In 2024, numerous elections were held globally, including the recent U.S.

presidential election.

The outcomes of the elections are expected to result in changes in policy, which could also have adverse effects on us or the business environment in which we operate more generally.

For example, the current U.S.

presidential administration has imposed or increased tariffs, including on imports from China, and proposed imposing or increasing tariffs on U.S.

trading partners, which could adversely affect markets, the business environment and our business.

On July 4, 2025, federal legislation generally referred to as H.R.

1 - One Big Beautiful Bill Act (the “Act” or “OBBBA”) was signed into law.

The Act includes a variety of tax provisions including permanently extending and modifying certain key aspects of existing federal tax law.

GAAP requires the effects of changes in tax laws and rates to be recognized in its financial statements in the period in which legislation is enacted.

The Company evaluated the OBBBA and there is no material impact on its financial position or results of operations in the current year.

Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.

We monitor developments and seek to manage our investments in a manner consistent with achieving our investment objective, but there can be no assurance that we will be successful in doing so.

For the fiscal year ended December 31, 2025, we generated income in the form of interest, net gains on the sales of loans originated (which primarily include sales of SBA 7(a) and ALP loans) and related servicing assets on such sales, dividends, electronic payment processing income, servicing income, and other fee income generated by loan originations and by our subsidiaries.

We originated loans that typically have terms of 10 to 25 years and bear interest at prime plus a margin.

3 unchanged sentences

Our portfolio activity for the fiscal year ended December 31, 2025, also reflects the proceeds of sales of guaranteed portions of SBA 7(a) loans we originated.

In addition, we received servicing income related to the guaranteed portions of SBA 7(a) loans which we originated and sold into the secondary market as well as on the portfolios of ALP loans owned and then securitized by NCL JV and TSO JV.

These recurring fees are are outlined in servicing agreements and were recorded when earned.

These recurring fees are outlined in servicing agreements and were recorded when earned.

In addition, we generated revenue in the form of loan origination fees (packaging and legal fees) as well as loan prepayment and late fees.

2 unchanged sentences

We recognized realized gains or losses on loans based on the difference between (1) the net proceeds from the disposition and any servicing assets recognized and (2) the cost basis of the loan without regard to unrealized gains or losses previously recognized.

We recorded current period changes in fair value of loans and assets that were measured at fair value as a component of the net change in unrealized appreciation (depreciation) on the loans or se rvicing assets, as appropriate, as well as amortization and impairment, if any, of LCM servicing rights in the consolidated statements of operations.

For the fiscal year ended December 31, 2024, our primary operating expenses were salaries and benefits, interest expense including interest on deposits, electronic payment processing expense, technology services expense, loan origination and servicing expenses, and other general and administrative costs, such as professional fees, marketing, referral fees, servicing costs and rent.

The Company’s Alternative Lending Program (ALP)

The Company has originated loans under its ALP since 2019.

These loans have terms between 10 and 25 years, bear fixed interest rates that reset every five years, and have prepayment penalties.

The criteria evaluated in underwriting ALP loans and the terms of these loans have been generally consistent over the ALP’s existence.

Prior to July 1, 2024, the Company originated ALP loans with the intent to sell the loans to a JV.

While the Company continues to source JV partners to participate in this program, during the third quarter of 2024, we made the decision to originate with the intent to securitize ALP loans with our subsidiary Newtek ALP Holdings as the originator and sponsor.

The Company could also originate ALP loans designated as HFI.

The Company does not expect any significant changes to the underwriting or terms of loans in its ALP.

In 2019, we launched a 50/50 joint venture, NCL JV, between NCL, a wholly-owned subsidiary of Newtek, and Conventional Lending TCP Holding, LLC, a wholly-owned, indirect subsidiary of BlackRock TCP Capital Corp.

(Nasdaq:TCPC).

NCL JV provided ALP loans to U.S.

middle-market companies and small businesses.

NCL JV ceased funding new loans during 2020.

On January 28, 2022, NCL JV closed an ALP loan securitization with the sale of $56.3 million Class A Notes, NCL Business Loan Trust 2022-1, Business Loan-Backed Notes, Series 2022-1, secured by a segregated asset pool consisting primarily of NCL JV’s portfolio of ALP loans, including loans secured by liens on commercial or residential mortgaged properties, originated by NCL JV and NBL.

The Notes were rated “A” (sf) by DBRS Morningstar.

The Notes were priced at a yield of 3.209%.

The proceeds of the securitization were used, in part, to repay the Deutsche Bank credit facility and return capital to the NCL partners.

Refer to NOTE 4—INVESTMENTS for selected financial information and a schedule of investments of NCL as of December 31, 2024.

On August 5, 2022, NCL and TSO II Booster Aggregator, L.P.

(“TSO II”) entered into a joint venture, TSO JV, governed by the Amended and Restated Limited Partnership Agreement for the TSO JV.

NCL and TSO II each committed to contribute an equal share of equity funding to the TSO JV and each have equal voting rights on all material matters.

The TSO JV intends to deploy capital over the course of time with additional leverage supported by a warehouse line of credit for the purpose of investing in ALP loans made to middle-market companies as well as small businesses.

TSO JV began making investments in ALP loans during the fourth quarter of 2022 and o n July 23, 2024, closed a securitization backed by Company originated ALP loans, selling $137.2 million of Class A Notes and $17.2 million of Class B Notes (collectively, the “TSO Notes”) issued by NALP Business Loan Trust 2024-1.

The Class A and Class B Notes received Morningstar DBRS ratings of “A (sf)” and “BBB (high) (sf),” respectively.

TSO JV ceased investing in new ALP loans in July 2024.

Refer to NOTE 4—INVESTMENTS for selected financial information and a schedule of investments of TSO JV as of December 31, 2024.

For the fiscal year ended December 31, 2025, our primary operating expenses were salaries and benefits, interest expense including interest on deposits, electronic payment processing expense, loan origination and servicing expenses, and other general and administrative costs, such as professional fees, marketing, referral fees, servicing costs and rent.

Discussion and Analysis of Financial Condition

3 unchanged sentences

As of December 31, 2024, the Company held the assets and liabilities of NTS for sale.

Refer to NOTE 9—ASSETS AND LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE.

Refer to NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp .

December 31, 2025 December 31, 2024 Change

8 unchanged sentences

Loans HFS, at fair value increased $599.6 million during the year ended December 31, 2025.

The overall increase was primarily the result of new loan originations during 2024, net of sales, in the amount of $181.1 million for ALP loans and $72.3 million in SBA loans.

December 31, 2024 December 31, 2023 Change

SBA, at fair value $ 159,788 $ 87,510 $ 72,278

ALP, at fair value 212,498 31,357 181,141

Total $ 372,286 $ 118,867 $ 253,419

Loans HFS, at LCM increased $2.2 million during the same period.

The overall increase was primarily the result of new loan originations during 2024, net of sales.

The overall increase was the result of an increase of $202.7 million for ALP loans, which were included in the $284.4 million of loans in the securitization transaction that did not close until January 2026.

In addition, holding guaranteed portions of SBA 7(a) loans for longer periods of time as well as new loan originations during 2025, in the amount of $396.9 million in SBA loans also contributed to the increase.

December 31, 2025 December 31, 2024 Change

3 unchanged sentences

SBA 7(a) Partials 1

20,753 — 20,753

Total SBA loans

556,689 159,788 396,901

ALP 415,148 212,498 202,650

Loans HFS, at fair value

$ 971,837 $ 372,286 $ 599,551

1 Reclassified from Loans HFS, at LCM

Loans HFS, at LCM decreased $32.3 million during the same period.

The overall decrease was primarily the result of loan sales that occurred in 2025.

December 31, 2025 December 31, 2024 Change

SBA 504 First Lien $ 19,075 $ 36,783 $ (17,708)

SBA 504 Second Lien 7,457 8,203 (746)

SBA 7(a) Partials 1

— 13,817 (13,817)

Loans HFS, at LCM $ 26,532 $ 58,803 $ (32,271)

1 Reclassified to Loans HFS, at fair value

Loans held for investment

At Fair value:

Loans HFI, at fair value was $369.7 million at December 31, 2024 compared to $469.8 million at December 31, 2023.

Loans HFI, at fair value were $281.2 million at December 31, 2025 compared to $369.7 million at December 31, 2024.

The balance consists primarily of SBA 7(a) loans as well as $5.7 million of loans that the Company owns 100% as a result of originating the loan and subsequently repurchasing the guaranteed portion from the SBA.

1 unchanged sentence

At Amortized Cost:

Loans HFI, at amortized cost consists of loans originated at or purchased by Newtek Bank.

Loans HFI, at amortized cost consist of loans originated at or purchased by Newtek Bank.

The $275.0 million increase in loans HFI, at amortized cost is the result of an increase in originations for the year ended December 31, 2025 over 2024.

Credit Quality:

Overall credit quality remained stable during the year.

The increase in nonperforming loans HFI is adequately covered by the allowance for credit losses and in line with the seasoning of the portfolio.

The Company continues to focus on prudent underwriting and portfolio diversification across its lending activities.

The following table presents an analysis of loans HFI with credit metrics, including a breakdown by days aged:

2 unchanged sentences

Current $ 794,951 88.9 % $ 575,444 92.8 %

Past Due 31-89 Days 20,585 3.3 % 4,896 1.5 %

Past Due 30-89 Days and accruing 20,555 2.3 % 20,585 3.3 %

Past Due 90 and more Days and accruing — — % — — %

Nonaccrual loans 78,814 8.8 % 24,341 3.9 %

8 unchanged sentences

Past Due 30-89 Days and accruing 16,746 6.0 % 41,558 11.2 %

Past Due 90-119 Days and accruing 9,268 2.5 % — — %

Past Due 90 and more Days and accruing 2,732 1.0 % 9,268 2.5 %

12 unchanged sentences

The average loan-to-value for this CRE portfolio was 57.5%.

The CRE portfolio is diversified by property type and geography, and management actively monitors concentration levels, loan to value ratios, and debt service coverage metrics as part of its ongoing credit risk management process.

Furthermore, there is limited exposure to office space.

The table below presents detail of the loans considered non-owner occupied CRE that are not carried at fair value:

20 unchanged sentences

Hotel — — — — 13 13

Multifamily — — — — — —

Total unfunded commitments — 55,149 55,149 — 48,415 48,415

13 unchanged sentences

13,814 — 13,814 13,814 — 13,814

Technology segment 1

— — — 11,800 3,379 15,179

Total $ 14,085 $ 512 $ 14,597 $ 14,085 $ 667 $ 14,752

1 As of December 31, 2024, the assets of the Technology segment are classified as held-for-sale.

See NOTE 9—ASSETS AND LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE for more information.

The change in goodwill and intangible assets for the Payments segment and NBNYC acquisition relates to amortization of intangible assets during the year ended December 31, 2024.

The change in goodwill and intangible assets relates to amortization of intangible assets during the year ended December 31, 2025.

Residuals in Securitizations, at Fair Value

The residuals in securitizations, at fair value arise from the NALP Business Loan Trust 2025-1 ALP securitization that the Company closed on April 23, 2025.

Residuals in securitizations were $76.7 million as of December 31, 2025.

The Securitization Trust meets the definition of a VIE.

The Company holds a variable interest in the VIE, however, the Company is not considered the primary beneficiary of the VIE, because the power over the activities that have the most significant impact on the economic performance of the Securitization Trust is held by the Class C Noteholder, and therefore, the Company is not required to consolidate the Securitization Trust.

The Company’s beneficial interest in the Securitization Trust is evidenced by sole ownership of the Ownership Certificate and its beneficial interest in the credit risk of the securitized ALP Loans.

As the Sponsor is a wholly owned subsidiary of the Company, the Company effectively owns 100% of the equity interest in the Trust.

Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES in the accompanying notes to the consolidated financial statements for additional information.

Settlement Receivable

1 unchanged sentence

The settlement receivable arises from the guaranteed portions of SBA 7(a) loans that were traded in the period but did not settle during the current period end and the cash was not received from the purchasing broker during the current period;

the amount varies depending on loan origination volume and timing of sales at quarter end.

the amount varies depending on loan origination volume and timing of sales at period end.

Total liabilities at December 31, 2025, were $2.3 billion, an increase of $583.6 million, or 33.1%, compared to total liabilities of $1.8 billion at December 31, 2024.

Total deposits were $973.1 million at December 31, 2024, consisting of $11.1 million in non-interest bearing deposits and $961.9 million in interest bearing deposits, a $508.6 million increase from the balance as of December 31, 2023.

As of December 31, 2024 and 2023, insured deposits represent 80.3% and 76.3%, respectively.

Increases in deposits were primarily driven by deposit gathering efforts in Consumer High Yield Savings accounts and six-month Certificates of Deposit to fund future balance sheet growth and increase liquidity levels at Newtek Bank.

Total deposits were $1.4 billion at December 31, 2025, consisting of $53.9 million in non-interest bearing deposits and $1.4 billion in interest bearing deposits, a $444.4 million increase from the balance as of December 31, 2024.

The increase in deposits is a result of increases in all of our deposit products due to our competitive interest rates well above the risk free rate and the sticky deposit relationships we foster by providing value to our depositors via the Newtek Advantage.

As of December 31, 2025 and December 31, 2024, insured deposits represent 73.6% and 80.3%, respectively, of deposits.

Borrowings Outstanding

2 unchanged sentences

NMS Webster Note 2

$ — $ 32,688 $ (32,688)

NMS Goldman Facility 3

88,352 — 88,352

SPV I Capital One Facility 16,085 21,192 (5,107)

19 unchanged sentences

51,391 — 51,391

2029 Notes (8.625%)

72,662 — 72,662

Total Parent Company Notes

4 unchanged sentences

1 Net of deferred financing costs.

2 At December 31, 2024 and December 31, 2023, the carrying amount of Newtek Bank’s FHLB borrowings includes a $0.04 million and $0.2 million purchase accounting adjustment, respectively.

3 On August 1, 2024, the 2024 Notes matured.

4 Effective December 11, 2024, the Company entered into Note Amendment and Exchange Agreements (the “Agreements”) with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 8.125% Notes, effecting amendments solely to (i) extend the February 1, 2025 maturity date of the 2025 8.125% Notes to the new maturity date of February 1, 2027 (the “New Maturity Date”) and (ii) provide that the 2027 8.125% Notes will be redeemable in whole, but not in part, at any time, at the option of the Company, from November 1, 2026 to the New Maturity Date, at a redemption price of 100% of the outstanding principal amount being redeemed plus any accrued but unpaid interest, to but excluding the redemption date.

2 On September 26, 2025, the NMS Webster Note was repaid in full.

3 On September 26, 2025, NMS entered into the Goldman Facility.

4 On March 31, 2025, the 2025 5.00% Notes matured.

5 On October 21, 2025, the Company entered into agreements with two institutional investors that were existing holders of the Company’s 2026 Notes to exchange the $20.0 million in total principal amount of the Company’s 2026 Notes held by such investors for an equal principal amount of the Company’s 2030 Notes.

On February 1, 2026, the 2026 Notes matured.

See “NOTE 24—SUBSEQUENT EVENTS - Exchange of 2026 Notes for 2031 Notes and Repayment of 2026 Notes ” for additional information.

6 Effective December 11, 2024, the Company entered into the Amendment and Exchange Agreements with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 Notes, effecting amendments solely to (i) extend the February 1, 2025 maturity date of the 2025 8.125% Notes to the new maturity date of February 1, 2027 (the “New Maturity Date”) and (ii) provide that the 2027 Notes will be redeemable in whole, but not in part, at any time, at the option of the Company, from November 1, 2026 to the New Maturity Date, at a redemption price of 100% of the outstanding principal amount being redeemed plus any accrued but unpaid interest, to but excluding the redemption date.

7 On March 19, 2025, the Company closed an exempt offering of $30.0 million in aggregate principal amount of its 2030 Notes.

The 2030 Notes bear interest at a rate of 8.375% per year payable semiannually on April 1 and October 1 each year, beginning October 1, 2025.

Borrowings were $819.9 million at December 31, 2025, compared to $708.0 million at December 31, 2024.

This increase was primarily due to a $69.6 million issuance of the 2029 8.50% Notes and a $72.7 million issuance of the 2029 8.625% Notes, as well as additional borrowings of $5.1 million, $47.2 million, and $22.8 million on the SPV I, II and III facilities, respectively.

These increases were partially offset by a $105.5 million reduction in the notes payable on securitization trusts, a $38.1 million redemption of the 2024 5.75% Notes, and $7.9 million in maturities of of FHLB advances.

This increase was primarily due to $88.4 million of new borrowings under the NMS Goldman Facility, additional borrowings of $115.1 million on the SPV II facility as well as $51.4 million issuance of the 2030 Notes.

These increases were partially offset by $32.7 million repayment in full of the NMS Webster Note, the maturity of $29.9 million of the 2025 5.00% Notes, $59.6 million reduction in the notes payable on securitization trusts, and $10.2 million repayments of borrowings on the SPV III facility, and $8.0 million in maturities of FHLB advances.

Deferred Taxes

2 unchanged sentences

The Company evaluated all NOLs for a valuation allowance and determined that none were required.

The increase in the deferred tax liability is driven by the increase in the fair value measurements on loans held for sale.

Results of Operations

Set forth below is a comparison of the results of operations for the years ended December 31, 2025 and 2024.

For a comparison of the results of operations for the years ended December 31, 2023 and 2022, during which years the Company operated as both a financial holding company and a BDC, see the Company's Form 10-K for the year ended December 31, 2023, as filed with the SEC on April 1, 2024.

For a comparison of the results of operations for the year ended December 31, 2023, see the Company's Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 17, 2025.

For the year ended December 31, 2025, the Company reported net income of $60.5 million, or $2.21 per basic and $2.18 per diluted share, compared to net income of $50.9 million, or $1.97 per basic and 1.96 per diluted share, for the year ended December 31, 2024.

The net increase in net income before taxes was partially offset by the non-recurring nature of the income tax benefit on the realization of deferred tax assets in 2023 when the Company converted to an FHC.

The net increase in net income before taxes was due to a $35.4 million increase of interest income on loans, and a $7.6 million increase in noninterest income, partially offset by a $12.5 million increase of provision for credit losses, a $13.2 million increase of interest expense on deposits.

Below is a summary of changes in the components of Net income:

5 unchanged sentences

Net income before taxes 79,977 68,692 11,285

Income tax expense/(benefit) 17,839 (1,956) 19,795

Income tax expense 19,465 17,839 1,626

Net income $ 60,512 $ 50,853 $ 9,659

Net Interest Income

Year Ended December 31,

2025 2024 Change

Interest income

Debt securities available-for-sale $ 924 $ 1,482 $ (558)

Loans and fees on loans 146,274 110,892 35,382

Other interest earning assets 11,217 9,044 2,173

Total interest income 158,415 121,418 36,997

Interest expense

Deposits 41,894 28,690 13,204

Notes and securitizations 42,846 45,454 (2,608)

Bank and FHLB borrowings 13,790 6,969 6,821

Total interest expense 98,530 81,113 17,417

Net interest income 59,885 40,305 19,580

Provision for credit losses 38,729 26,216 12,513

Net interest income after provision for credit losses

$ 21,156 $ 14,089 $ 7,067

Interest Income

Loans and fees on loans:

The $35.4 million increase in interest income on the Company’s loan portfolio was attributable to increases in the average balances of loans HFI and HFS, which increased $148.9 million and $362.5 million, respectively, as well as the average outstanding accrual portfolio of loans held for investment increasing to $1.6 billion from $1.1 billion for the year ended December 31, 2025 and 2024, respectively.

The increase in the average balance of loans HFS was attributable to originations of SBA 504 and ALP loans, and the increase in the average outstanding accrual loan portfolio resulted from the origination of new SBA 7(a) loans period over period.

Interest Expense

The following is a summary of interest expense by facility for the year ended December 31, 2025 and 2024:

December 31, 2025 December 31, 2024 Change

Deposits $ 41,894 $ 28,690 $ 13,204

Notes and securitizations:

Notes payable - Securitization Trusts 12,012 21,097 (9,085)

— 1,409 (1,409)

2025 5.00% Notes 2

462 1,850 (1,388)

6,757 7,043 (286)

4,091 4,599 (508)

3,548 3,548 —

2029 8.50% Notes 6

6,618 3,879 2,739

2029 8.625% Notes 7

6,957 2,029 4,928

2,401 — 2,401

Total notes and securitizations 42,846 45,454 (2,608)

Bank and FHLB Borrowings:

Bank notes payable 13,494 6,446 7,048

FHLB Advances 296 523 (227)

Total bank and FHLB borrowings 13,790 6,969 6,821

Total interest expense $ 98,530 $ 81,113 $ 17,417

1 On August 1, 2024, the 2024 Notes matured.

2 On March 31, 2025, the 2025 5.00% Notes matured.

3 On October 21, 2025, the Company entered into agreements with two institutional investors that were existing holders of the Company’s 2026 Notes to exchange the $20.0 million in total principal amount of the Company’s 2026 Notes held by such investors for an equal principal amount of the Company’s 2030 Notes.

On February 1, 2026, the 2026 Notes matured.

See “NOTE 24—SUBSEQUENT EVENTS - Exchange of 2026 Notes for 2031 Notes and Repayment of 2026 Notes ” for additional information.

4 Effective December 11, 2024, the Company entered into the Amendment and Exchange Agreements with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 Notes.

5 On August 31, 2023, the Company completed a public offering of $40.0 million aggregate principal amount of 8.00% notes due 2028.

The Notes will mature on September 1, 2028.

The Notes bear interest at a rate of 8.000% per year, payable quarterly on March 1, June 1, September 1, and December 1 each year, commencing on December 1, 2023.

6 On May 30, 2024, the Company completed a public offering of $62.5 million aggregate principal amount of 8.500% notes due 2029.

On June 3, 2024, the underwriters exercised their option to purchase an additional $9.4 million in aggregate principal amount of the 2029 Notes.

The Notes will mature on June 1, 2029.

The Notes bear interest at a rate of 8.500% per year, payable quarterly on March 1, June 1, September 1, and December 1 each year, commencing on September 1, 2024.

7 On September 16, 2024, the Company completed a public offering of $75.0 million aggregate principal amount of 8.625% notes due 2029.

The Notes will mature on October 15, 2029.

The Notes bear interest at a rate of 8.625% per year, payable quarterly on January 15, April 15, July 15, and October 15 each year, commencing on January 15, 2025.

8 On March 19, 2025, the Company completed an exempt offering of $30.0 million aggregate principal amount of notes due 2030.

The Notes will mature on April 1, 2030.

The Notes bear interest at a rate of 8.375% per year, payable semiannually on April 1 and October 1 each year, commencing on October 1, 2025.

On October 21, 2025, the Company entered into agreements with two institutional investors that were existing holders of the Company’s 2026 Notes to exchange $20.0 million in total principal amount of the Company’s 2026 Notes held by such investors for an equal principal amount of the Company’s 2030 Notes.

One of the investors also agreed to purchase $2.0 million in newly issued additional principal amount of the Company’s 2030 Notes.

The increase in interest expense period over period is primarily from additional interest expense on deposits of $13.2 million, additional interest expense of $6.8 million on bank and FHLB borrowings, and additional interest expense of $2.7 million, $4.9 million, and $2.4 million on the 2029 8.50% Notes, the 2029 8.625% Notes, and the 2030 Notes, respectively.

The increase is partially offset by a $9.1 million reduction in interest due to securitization payoffs, as well as a $1.4 million and $1.4 million reduction in interest expense on the 2024 Notes and the 2025 5.00% Notes, respectively.

Net Interest Income and Margin

6 unchanged sentences

Interest-earning assets:

Interest-earning balances in other banks $ 180,753 $ 9,044 5.00 % $ 186,566 $ 8,854 4.75 %

Other interest-earning assets $ 271,021 $ 11,217 4.14 % $ 180,753 $ 9,044 5.00 %

Investment securities 15,875 924 5.82 31,847 1,482 4.65

21 unchanged sentences

In response to market conditions and consistent with its business plan, Newtek Bank has been focused on increasing its liquidity position by raising additional deposits and maintaining a significant portion of its liquidity in the form of cash held at the Federal Reserve, approximately $277.8 million as of December 31, 2025, as opposed to long-term investments.

In addition, Newtek Bank management continues to closely monitor market conditions with a focus on its asset liability management policies, as well as closely monitoring, among other things, capital levels, to ensure compliance with regulatory guidelines and the OCC Operating Agreement.

The increase in the average balance of loans HFS was attributable to originations of SBA 504, SBA 7(a) and ALP loans, and the increase in the average outstanding accrual loan portfolio resulted from the origination of new SBA 7(a) loans period over period.

Rate/Volume Analysis

8 unchanged sentences

Interest income:

Interest-earning balances in other banks $ 466 $ (276) $ 190

Other interest-earning assets $ (2,344) $ 4,517 $ 2,173

Investment securities 185 (743) (558)

13 unchanged sentences

For the year ended December 31, 2025 and 2024, there was a provision for credit losses of $38.7 million and $26.2 million, respectively.

The increase was due to increases in net charge-offs, specific reserves on impaired loans, and balances of loans held for investment at amortized cost, across all products but specifically SBA 7(a) loans.

The increase was due to increases in net charge-offs, specific reserves on individually evaluated loans, and balances of loans held for investment at amortized cost, across all products but specifically SBA 7(a) loans.

Noninterest Income

5 unchanged sentences

Net gains on sales of loans 47,555 97,183 (49,628) (51.1)

Net gain (loss) on loans under the fair value option 5,200 18,008 (12,808) (71.1)

Net gain on residuals in securitizations 30,015 — 30,015 100.0

Net gain on loans under the fair value option 61,157 5,200 55,957 1,076.1

Technology and IT support income — 19,643 (19,643) (100.0)

4 unchanged sentences

The Company accounts for servicing assets in accordance with ASC Topic 860-50 - Transfers and Servicing - Servicing Assets and Liabilities.

The Company earns servicing fees from the guaranteed portions of SBA 7(a) loans it originates and sells and from servicing the ALP portfolios of NCL JV and TSO JV.

The Company earns servicing fees from the guaranteed portions of SBA 7(a) loans it originates and sells, from the SBA 7(a) loan securitizations sponsored by NSBF, and from servicing the ALP portfolios in securitizations sponsored by NCL JV (terminated in August 2025) , TSO JV and Newtek ALP Holdings.

Servicing assets for loans originated by the Company’s nonbank subsidiaries are measured at FV at each reporting date and the Company reports changes in the FV of servicing assets in earnings in the period in which the changes occur.

37 unchanged sentences

1,045 290,205 2,041 694,750

Average sale price as a percent of principal balance 1

Average net sale price as a percent of principal balance 1

111.05 % 110.97 %

3 unchanged sentences

The increase in sales prices in 2025 resulted from higher demand.

The increase in overall net gains on sales of loans resulted from higher volumes of sales compared to the prior year at better market premiums than the prior year and the expectation of lower interest rates which would slow prepay speeds.

The decrease in overall net gains on sales of loans resulted from lower volumes of sales compared to the prior year at higher market premiums than the prior year.

Additionally, the decrease in SBA 7(a) guaranteed loans sold is primarily due to management holding the loans for a longer period of time.

The table below provides selected statistics on the historical net premiums on sales of guaranteed portions of SBA 7(a) loans realized by NewtekOne:

1 unchanged sentence

High Low Median

2022 109.71 % 115.77 % 106.11 % 110.16 %

2023 110.20 % 114.04 % 106.00 % 110.42 %

2024 110.97 % 114.80 % 107.18 % 111.19 %

Year ended December 31, 2023 110.20 % 114.04 % 106.00 % 110.42 %

Year ended December 31, 2024 110.97 % 114.80 % 107.18 % 111.19 %

Year ended December 31, 2025 111.05 % 114.06 % 107.80 % 110.46 %

Weighted Average

110.58 % 114.80 % 106.00 % 110.76 %

During the wind-down of NSBF’s operations, NSBF is required to continue to own its SBA 7(a) loans and PPP Loans in its SBA loan portfolio to maturity, liquidation, charge-off, or (subject to SBA’s prior written approval) sale or transfer.

In addition, SBL will service and liquidate NSBF’s SBA Loan Portfolio, including processing forgiveness and loan reviews for PPP Loans pursuant to an SBA approved lender service provider agreement with SBL.

During the wind-down of NSBF’s operations, NSBF is required to continue to own its SBA 7(a) loans in its loan portfolio to maturity, liquidation, charge-off, or (subject to SBA’s prior written approval) sale or transfer.

In addition, SBL will service and liquidate NSBF’s SBA Loan Portfolio, pursuant to an SBA approved lender service provider agreement with SBL.

The Company will continue to measure NSBF’s SBA 7(a) loan portfolio at fair value until the portfolio is completely runoff.

The Company will report both realized and unrealized gains and losses relating to the fair value adjustments on the legacy NSBF SBA 7(a) portfolio.

Net Gain on Residuals in Securitizations

Net gains on residuals in securitizations for the year ended December 31, 2025 were $30.0 million.

There were no net gains on residuals in securitizations for the year ended December 31, 2024.

This resulted from the Company’s equity interest in the 2025-1 Securitization Trust which closed on April 23, 2025.

To consummate the transaction, $216.6 million of ALP loans held for sale at fair value were sold into the securitization trust at par.

This resulted in $35.4 million of previously recorded gains on ALP loans under the fair value option to be reversed.

The residual in the securitization (represented by the ownership certificate) was then valued resulting in a gain that was netted against the transaction costs.

Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES in the accompanying notes to the consolidated financial statements for additional information.

Net Gain (Loss) on Loans under the Fair Value Option

Net gain (loss) on loans accounted for under the fair value option for the year ended December 31, 2025 and 2024 were as follows:

For the year ended

December 31, 2024 December 31, 2023 Change

Year ended December 31,

2025 2024 Change

SBA 7(a) Unguaranteed Loans $ (16,089) $ (26,346) $ 10,257

3 unchanged sentences

Net unrealized gain (loss) on loans accounted for under the fair value option relates to the guaranteed portions of SBA loans made which the Company sells into a secondary market, the unguaranteed portions of SBA loans made which the Company holds, SBA 504 loans that are held for sale, and ALP loans that are held for sale.

This gain (loss) represents the fair value adjustment of loans .

This unrealized gain (loss) represents the fair value adjustment of loans .

The amount of the unrealized gain (loss) is determined by the quantity of loans held for sale at quarter end, the change in secondary market pricing conditions, and the valuation of the loans that are not held for sale.

During the year ended December 31, 2024, the Company recorded unrealized losses on SBA 7(a) unguaranteed loans accounted for under the fair value option as the portfolio paid down.

During the year ended December 31, 2023, the Company originated $158.5 million of SBA 7(a) loans and elected the fair value option on those loans, which led to increased gains.

The $27.1 million increase in gain on loans accounted for under the fair value option from SBA 504 and Non-SBA loans is primarily volume driven from an increase in ALP and 504 originations.

During the year ended December 31, 2025 and 2024, the Company recorded unrealized losses on SBA 7(a) unguaranteed loans accounted for under the fair value option as the portfolio paid down.

During the year ended December 31, 2025 and 2024, the Company recorded unrealized gains on SBA 7(a) guaranteed loans accounted for under the fair value option primarily due to holding guaranteed portions of SBA 7(a) loans for longer periods of time.

The $11.5 million increase in unrealized gain (loss) on loans accounted for under the fair value option from SBA 504 and Non-SBA loans is primarily volume driven by an increase in ALP loans held as of December 31, 2025 that were sold into a securitization trust and securitized in January 2026.

Refer to NOTE 24—SUBSEQUENT EVENTS :

Securitization .

Technology and IT Support Income

Technology and IT support income decreased by $5.3 million from $24.9 million for the year ended December 31, 2023 to $19.6 million for the year ended December 31, 2024.

The overall decrease was due to a decrease in web hosting and IT support revenue.

Technology and IT support income was $19.6 million for the year ended December 31, 2024.

There was no Technology and IT support income for the year ended December 31, 2025, due to the sale of NTS.

Refer to NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp .

Other Noninterest Income

For the year ended December 31, 2025 and 2024, other noninterest income was related primarily to loan origination fees (legal and packaging) on loans sold or carried at fair value.

Other items that contributed to the increase included prepayment and late fees earned from SBA 7(a) loans.

Other items that contributed to the $7.3 million decrease included a decrease on prepayment and late fees earned from SBA 7(a) loans.

The Company originated 2,269 of SBA 7(a) loans compared to 2,427 loans for the year ended December 31, 2025 and 2024, respectively.

The increase also includes $10.7 million of unrealized gains on joint ventures and other non-control investments for the year ended December 31, 2024 compared to $3.2 million in the prior period.

In addition, there was $4.4 million of net unrealized losses on joint ventures and other investments for the year ended December 31, 2025 compared to $10.7 million in gains in the prior period.

Non-Interest Expense

11 unchanged sentences

Salaries and Employee Benefits Expense

The increase in salaries and employee benefits was primarily attributable to an increase in entity headcount from 528 employees at December 31, 2023 to 591 employees at December 31, 2024.

Also contributing to the increase were merit increases for existing employees that went into effect in the first quarter of 2024 as well as increased benefits costs, primarily higher medical and other insurance costs.

The increase in salaries and employee benefits was primarily attributable to higher benefit costs, including medical and other insurance expenses, as well as an increase in stock-based compensation expense.

Technology Services Expense

The $2.0 million decrease in technology services expenses for the year ended December 31, 2024 corresponded with the $5.3 million decrease in technology and IT support income.

The $12.3 million decrease in technology services expenses for the year ended December 31, 2025 corresponded with the NTS Sale.

Refer to NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp .

Professional Services Expense

The increase in professional services expense period over period is primarily attributable to costs associated with the NTS disposition that occurred on January 2, 2025.

Refer to “Subsequent Events - Sale of NTS.”

The decrease in professional services expense period over period is primarily attributable to costs associated with the NTS disposition that occurred on January 2, 2025.

Refer to NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp .

Other Loan Origination and Maintenance Expense

2 unchanged sentences

The decrease in depreciation and amortization period over period is primarily attributable to the full amortization of intangible assets during the second half of 2024, which resulted in less amortization in 2025 compared to the prior year.

Loss on Extinguishment of Debt

The increase in loss on extinguishment of debt period over period is attributable to the repayment in full of the NMS Webster Note on September 26, 2025.

Other General and Administrative Costs

The increase in other general and administrative costs of $7.4 million is primarily driven by higher technology-related costs following the sale of NTS in 2025.

These costs were previously eliminated in consolidation but are now recognized as standalone expenses post-divestiture.

Results of Segment Operations

The Company has five reportable segments Banking, Alternative Lending, Technology, NSBF, and Payments.

The Company has four reportable segments Banking, Alternative Lending, NSBF, and Payments.

A description of each segment and the methodologies used to measure financial performance is described in NOTE 22—SEGMENTS in the accompanying Notes to the Consolidated Financial Statements.

4 unchanged sentences

Alternative Lending 88,481 59,724 28,757 48.1 %

Technology 86 1,367 (1,281) (94) %

— 86 (86) (100.0) %

NSBF (19,972) (28,684) 8,712 (30.4) %

3 unchanged sentences

Consolidated net income $ 60,512 $ 50,853 $ 9,659 19.0 %

1 As a result of commitments made to the Federal Reserve, the Company divested of NTS on January 2, 2025, and is no longer a reportable segment.

See NOTE 4—INVESTMENTS:

Intelligent Protection Management Corp .

The banking segment includes Newtek Bank as well as its consolidated subsidiary SBL.

2 unchanged sentences

The results include $62.2 million of net interest income during the year ended December 31, 2025 compared to $39.7 million of net interest income during the year ended December 31, 2024.

During 2024, the majority of loans were funded by Newtek Bank compared to 2023, when all SBA 7(a) loans were funded by NSBF until it went into wind-down on April 13, 2023.

During 2025, the Company increased the average balances of loans HFI and HFS as well as the average outstanding accrual portfolio of loans HFI, which was offset by an increase in the provision for credit losses and salaries and benefits, resulting in decrease in net income for the year ended December 31, 2025 compared to the year ended December 31, 2024.

Alternative Lending

3 unchanged sentences

While the Company continues to source JV partners to participate in this program, during the third quarter of 2024, the Company made the decision to originate with the intent to securitize ALP loans with our subsidiary Newtek ALP Holdings as the originator and sponsor without a joint venture partner;

the Company’s first such securitization transaction was consummated during the second quarter of 2025.

The Company could also originate ALP loans designated as HFI.

Technology (NTS) provides website hosting, dedicated server hosting, cloud hosting, web design and development, internet marketing, e-commerce, data storage, backup and disaster recovery, and other related services including consulting and implementing technology solutions for enterprise and commercial clients across the U.S.

As a result of commitments made to the Federal Reserve, the Company divested of NTS on January 2, 2025, and will cease to be a reportable segment.

See “NOTE 25—SUBSEQUENT EVENTS - Sale of NTS.”

On August 27, 2025, NALH entered into an interest purchase agreement with TCP to acquire TCP’s 50% ownership interest in NCL JV for $15.75 million, resulting in NALH owning 100% of NCL JV.

Compared to the year ended December 31, 2024, there were more loans originations that drove higher income for the year ended December 31, 2025, as well as larger gains on loans at fair value.

NSBF includes NSBF’s legacy portfolio of SBA 7(a) loans held outside Newtek Bank.

The decrease in net income is due to the wind-down of NSBF’s operations.

The change in net income is due to the wind-down of NSBF’s operations.

Payments includes NMS, POS and Mobil Money.

4 unchanged sentences

Liquidity and Capital Resources

Our liquidity and capital resources are derived from our deposits, parent company notes, securitization transactions and earnings and cash flows from operations, including loan sales and repayments.

The Company actively manages liquidity to support business operations and meet obligations through ongoing monitoring of deposit trends and funding sources.

In addition, the Company performs stress testing designed to assess our ability to meet both expected and unexpected cash flow needs.

Management believes current liquidity levels are sufficient to support planned operations and react to reasonably foreseeable market volatility.

Our liquidity and capital resources are derived from our deposits, Company notes, securitization transactions and earnings and cash flows from operations, including loan sales and repayments.

The Company maintains a diversified deposit base across its customers.

In the year ended December 31, 2025, our primary use of funds from operations included originations of loans and payments of fees, interest, and other operating expenses we incurred.

2 unchanged sentences

The registration statement on Form S-3 was declared effective by the SEC on July 27, 2023.

On November 17, 2023, the Company entered into the 2023 ATM Equity Distribution Agreement.

The 2023 ATM Equity Distribution Agreement provides that the Company may offer and sell up to 3,000,000 shares of Common Stock from time to time through the placement agents.

On November 17, 2023, the Company entered into the Original ATM Equity Distribution Agreement, which was amended and restated on June 6, 2025.

The Amended and Restated Equity Distribution Agreement provides that the Company may offer and sell up to 5,000,000 shares of Common Stock from time to time through the placement agents.

On November 1, 2024, the Company’s Board of Directors approved a new stock repurchase program granting the Company authority to repurchase up to 1.0 million shares of Company common stock during the next twelve months.

On November 7, 2025, the Company’s Board of Directors approved a twelve month extension of the stock repurchase program.

In addition, on September 11, 2025, the Board approved a debt repurchase program granting the Company authority to repurchase up to $5.0 million aggregate principal amount of the Company’s 2029 Notes during the following six months.

Based on management’s assessment as of the reporting date, the Company has not identified trends or uncertainties related to credit quality, liquidity, or capital that are reasonably likely to have a material adverse effect on its financial condition or results of operations.

Regulatory Capital

1 unchanged sentence

The Company and Newtek Bank are primarily constrained by the Total Capital and Leverage ratios given the mix of assets vis-a-vis capital.

The Company and Newtek Bank are subject to various regulatory capital requirements administered by the Federal banking agencies.

The Company and the Bank manage their capital to comply with their internal planning targets and regulatory capital standards administered by federal banking agencies.

Capital amounts and ratios for the Company as of December 31, 2025 and 2024 are presented in the table below:

14 unchanged sentences

1 Exclusive of the capital conservation buffer of 2.5% of risk-weighted assets.

Under the applicable regulatory capital standards, Newtek Bank remained “well-capitalized” under the prompt corrective action measures as of the reporting date, with capital ratios exceeding minimum regulatory requirements and surpassing the capital conservation buffer requirements.

Capital amounts and ratios for Newtek Bank as of December 31, 2025, and 2024 are presented in the table below.

As of December 31, 2024 and 2023, Newtek Bank was categorized as “well-capitalized” under the prompt corrective action measures and met the capital conservation buffer requirements.

For Capital Adequacy Purposes 1

13 unchanged sentences

Equity ATM Program

On June 25, 2020, the Company entered into the 2020 ATM Equity Distribution Agreement.

On July 20, 2022, the Company entered into Amendment No.

1 to the 2020 ATM Equity Distribution Agreement.

The 2020 ATM Equity Distribution Agreement, as amended, provided that the Company could offer and sell up to 6,400,000 shares of common stock from time to time through the placement agents.

From inception through December 31, 2022, we sold 3,069,754 shares of our common stock at a weighted average price of $23.02 per share.

Proceeds, net of offering costs and expenses, were $70.6 million.

The Company paid the placement agents $1.4 million in compensation.

On November 17, 2023, the Company entered into the 2023 ATM Equity Distribution Agreement.

The 2023 ATM Equity Distribution Agreement provides that the Company may offer and sell up to 3.0 million shares of Common Stock from time to time through the placement agents under the ATM Program.

The Company may, subject to market conditions, continue to engage in activity under the Equity ATM Program.

The following table summarizes the total shares sold and net proceeds received under the 2020 and 2023 ATM Equity Distribution Agreement:

2020 ATM Program

Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022

Shares sold — — 107

Net weighted average price per share $ — $ — $ 19.12

Net proceeds $ — $ — $ 2,054

The Company’s shelf registration statement on Form S-3 was declared effective by the SEC on July 27, 2023.

On November 17, 2023, the Company entered into the Original ATM Equity Distribution Agreement.

The Original ATM Equity Distribution Agreement provided that the Company may offer and sell up to 3.0 million shares of Common Stock from time to time through the placement agents thereunder.

The Original ATM Equity Distribution Agreement was amended and restated on June 6, 2025.

The Amended and Restated Equity Distribution Agreement provides that the Company may offer and sell up to 5.0 million shares of Common Stock from time to time through the placement agents thereunder (inclusive of shares of Common Stock sold under the Original ATM Distribution Agreement) and added certain additional placement agents.

The Company may, subject to market conditions, engage in activity under the ATM Program.

The following table summarizes the total shares sold and net proceeds received under the ATM Equity Distribution Agreement:

Year ended December 31,

2023 ATM Program

Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022

2025 2024 2023

Shares sold 425 1,100 —

2 unchanged sentences

Placement agent fees paid

Stock Repurchase Program

$ 104 $ 282 $ —

Stock and Debt Repurchase Programs

On November 1, 2024, the Company’s Board approved a new stock repurchase program granting the Company authority to repurchase up to 1.0 million shares of Company common stock during the following twelve months.

The actual timing and amount of any repurchases under the plan will be determined by the Company in its discretion, and will depend on a number of factors, including market conditions, applicable legal requirements, the Company's capital needs and whether there is a better alternative use of capital.

The Company has no obligation to repurchase any amount of its common stock under its new stock repurchase program.

The actual timing and amount of any repurchases under the debt repurchase plan will be determined by the Company in its discretion, and will depend on a number of factors, including market conditions, applicable legal requirements, the Company's capital needs and whether there is a better alternative use of capital.

The Company has no obligation to repurchase any amount of its debt securities under this debt repurchase program.

Pursuant to the debt repurchase program, the Company repurchased 2,700 shares of its 2 029 8.50% Notes on September 22, 2025.

The following table summarizes the total shares repurchased and net proceeds received under the stock repurchase program:

Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022

Year Ended December 31,

2025 2024 2023

Shares repurchased

Net weighted average price per share $ 10.43 $ 13.35 $ —

Net proceeds $ 402 $ — $ —

Net purchase price $ 1,487 $ 402 $ —

On May 30, 2024, the Company completed a registered offering of $71.9 million in aggregate principal amount of its 2029 8.50% Notes, which includes the underwriters’ exercise of the option granted by the Company to purchase an additional $9.4 million in aggregate principal amount of the 2029 8.50% Notes.

The 2029 8.5% Notes will mature on June 1, 2029.

The Company received $69.6 million in proceeds, before expenses, from the sale of the 2029 8.50% Notes.

1 unchanged sentence

On September 16, 2024, the Company completed a registered offering of $75.0 million aggregate principal amount of 2029 8.625% Notes.

The 2029 8.625% Notes will mature on October 15, 2029.

The 2029 8.625% Notes are scheduled to mature on October 15, 2029.

The Company received $72.8 million in proceeds, before expenses, from the sale of the 2029 8.625% Notes.

Theses Notes bear interest at a rate of 8.625% per year, payable quarterly on January 15, April 15, July 15, and October 15 each year, commencing on January 15, 2025.

These Notes bear interest at a rate of 8.625% per year, payable quarterly on January 15, April 15, July 15, and October 15 each year, commencing on January 15, 2025.

, and trade on the Nasdaq Global Market under the trading symbol “NEWTH.” At December 31, 2025, the Company was in compliance with all covenants related to the 2029 8.625% Notes.

On August 31, 2023, the Company completed a registered offering of $40.0 million in aggregate principal amount of its 8.00% 2028 Notes.

The 2028 Notes are scheduled to mature on September 1, 2028.

The Company received $38.0 million in proceeds, before expenses, from the sale of the 2028 Notes.

2 unchanged sentences

The sale of the 2026 Notes generated proceeds of approximately $111.3 million, net of underwriter's fees and expenses.

The 2026 Notes will mature on February 1, 2026 and may be redeemed in whole or in part at any time or from time to time at the Company’s option upon not less than 30 days nor more than 60 days written notice by mail prior to the date fixed for redemption thereof, at a redemption price equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

The 2026 Notes are scheduled to mature on February 1, 2026 and may be redeemed in whole or in part at any time or from time to time at the Company’s option upon not less than 30 days nor more than 60 days written notice by mail prior to the date fixed for redemption thereof, at a redemption price equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

The 2026 Notes bear interest at a rate of 5.50% per year payable quarterly on February 1, May 1, August 1 and November 1 of each year, commencing on May 1, 2021, and trade on the Nasdaq Global Market under the trading symbol “NEWTZ.” At December 31, 2025, the Company was in compliance with all covenants related to the 2026 Notes.

On October 21, 2025, the Company entered into agreements with two institutional investors that were existing holders of the Company’s 2026 Notes to exchange the $20.0 million in total principal amount of the Company’s 2026 Notes held by such investors for an equal principal amount of the Company’s 2030 Notes.

The transactions were conducted pursuant to exemptions from the registration requirements of the Securities Act.

On February 1, 2026, the 2026 Notes matured.

See “NOTE 24—SUBSEQUENT EVENTS - Exchange of 2026 Notes for 2031 Notes and Repayment of 2026 Notes ” for additional information.

The 2029, 2028 and 2026 Notes are the Company’s direct unsecured obligations and rank:

2 unchanged sentences

(iii) effectively subordinated to all the Company’s existing and future secured indebtedness (including indebtedness that is initially unsecured to which the Company subsequently grants security), to the extent of the value of the assets securing such indebtedness;

and (iv) structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries.The Base Indenture, and each supplemental indenture thereto, contains certain covenants.

and (iv) structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries.

The Base Indenture, and each supplemental indenture thereto, contains certain covenants.

The Base Indenture provides for customary events of default and further provides that the Trustee or the holders of 25% in aggregate principal amount of the outstanding Notes may declare such Notes immediately due and payable upon the occurrence of any event of default after expiration of any applicable grace period.

In addition, the supplemental indentures for the 2026 Notes include covenants requiring the Company to comply with (regardless of whether it is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a) of the 1940 Act (or any successor provisions), to comply with (regardless of whether it is subject to) the restrictions on dividends, distributions and purchase of capital stock set forth in Section 18(a)(1)(B) of the 1940 Act as modified by Section 61(a) of the 1940 Act and to provide financial information to the holders of the 2026 Notes and the Trustee if the Company should no longer be subject to the reporting requirements under the Exchange Act (“BDC Covenants”).

These covenants are subject to important limitations and exceptions that are described in the Base Indenture, as supplemented by the supplemental indentures.

In addition, the supplemental indenture for the 2026 Notes included covenants requiring the Company to comply with (regardless of whether it is subject to), amongst other things, the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a) of the 1940 Act (or any successor provisions).

At December 31, 2025, the Company was in compliance with all covenants related to the Notes.

In July 2019, the Company completed a registered offering of $55.0 million aggregate principal amount of 5.75% 2024 Notes.

In August 2019, the underwriters exercised their option to purchase an additional $8.25 million in aggregate principal amount of the 2024 Notes.

On February 16, 2021 and May 20, 2021, the Company issued an additional $5.0 million and $10.0 million in aggregate principal amount of the 2024 Notes, respectively.

2 unchanged sentences

Private Placements

On November 27, 2020, the Company and Trustee entered into the Fifth Supplemental Indenture to the Base Indenture between the Company and the Trustee, relating to the issuance, offer and sale of $5.0 million aggregate principal amount of its 2025 6.85% Notes.

The offering was consummated pursuant to the terms of a purchase agreement among the Company and an accredited investor, which provided for the 2025 6.85% Notes to be issued to the purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act.

The net proceeds from the sale of the notes were approximately $4.8 million, after deducting structuring fees and estimated offering expenses, each payable by the Company.

The Company exercised its option to issue up to $10.0 million of additional 2025 6.85% Notes to the purchaser, and issued $10.0 million in additional 2025 6.85% Notes to the purchaser in an exempt offering in January 2021.

On March 31, 2022, the Company caused notices to be issued to the holder of its 2025 6.85% Notes regarding the Company’s exercise of its option to redeem all $15.0 million in aggregate principal amount of the Notes on May 2, 2022.

The Notes were redeemed on May 2, 2022 for 100% of their principal amount ($25 per Note), plus the accrued and unpaid interest thereon from February 28, 2022 through, but excluding, May 2, 2022.

On March 19, 2025, the Company closed an exempt offering of $30.0 million in aggregate principal amount of its 2030 Notes.

The offering was consummated pursuant to the terms of a purchase agreement dated March 19, 2025 among the Company and 11 institutional accredited investors.

The purchase agreement provided for the 2030 Notes to be issued to the Purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act.

The 2030 Notes are scheduled to mature on April 1, 2030 and could be redeemed in whole or in part at any time.

The 2030 Notes bear interest at a rate of 8.375% per year payable semiannually on April 1 and October 1 each year, beginning October 1, 2025.

One of the investors also agreed to purchase $2.0 million in newly issued additional principal amount of the Company’s 2030 Notes.

The transactions were conducted pursuant to exemptions from the registration requirements of the Securities Act.

On January 23, 2023, we completed a private placement offering of $50.0 million aggregate principal amount of 8.125% notes due 2025.

1 unchanged sentence

The Notes were scheduled to mature on February 1, 2025.

Effective December 11, 2024, the Company entered into Note Amendment and Exchange Agreements (the “Agreements”) with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 8.125% Notes, effecting amendments solely to (i) extend the February 1, 2025 maturity date of the 2025 8.125% Notes to the new maturity date of February 1, 2027 (the “New Maturity Date”) and (ii) provide that the 2027 8.125% Notes will be redeemable in whole, but not in part, at any time, at the option of the Company, from November 1, 2026 to the New Maturity Date, at a redemption price of 100% of the outstanding principal amount being redeemed plus any accrued but unpaid interest, to but excluding the redemption date.The Notes bear interest at a rate of 8.125% per year payable semiannually on February 1 and August 1 each year, commencing on August 1, 2023.

NSBF Capital One Facility

Prior to October 2023, NSBF maintained a $150.0 million Capital One facility to finance NSBF’s origination of unguaranteed and guaranteed portions of SBA 7(a) loans.

The portion of the facility collateralized by the government guaranteed portion of SBA 7(a) loans had an interest rate of Prime minus 0.75% and the interest rate on the portion of the facility collateralized by the non-guaranteed portion of SBA 7(a) loans was Prime plus 0.25% .

The facility provided for a 55% advance rate on the non-guaranteed portions of the SBA 7(a) loans NSBF originated, and a 90% advance rate on the guaranteed portions of SBA 7(a) loans NSBF originated and a 90% advance rate on the guaranteed portions of SBA 7(a) loans NSBF originated.

NSBF ceased originating new loans in April 2023.

The NSBF Capital One facility was paid off and terminated in October of 2023.

Effective December 11, 2024, the Company entered into the Amendment and Exchange Agreements with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 Notes, effecting amendments solely to (i) extend the February 1, 2025 maturity date of the 2025 8.125% Notes to the new maturity date of February 1, 2027 (the “New Maturity Date”) and (ii) provide that the 2027 Notes will be redeemable in whole, but not in part, at any time, at the option of the Company, from November 1, 2026 to the New Maturity Date, at a redemption price of 100% of the outstanding principal amount being redeemed plus any accrued but unpaid interest, to but excluding the redemption date.

The Notes bear interest at a rate of 8.125% per year payable semiannually on February 1 and August 1 each year.

On March 31, 2022, the Company completed a private placement of $15.0 million aggregate principal amount of its 2025 5.00% Notes.

The offering was consummated pursuant to the terms of a purchase agreement dated March 31, 2022 among the Company and an accredited investor, which provided for the 2025 5.00% Notes to be issued to the purchaser in a transaction that relied on Section 4(a)(2) of the Securities Act to be exempt from registration under the Securities Act.

The net proceeds from the sale of the notes were approximately $14.5 million, after deducting structuring fees and estimated offering expenses.

On May 2, 2022, the Company issued an additional $15.0 million in aggregate principal amount of the 2025 5.0% Notes.

The 2025 5.00% Notes were issued under the Base Indenture and the Tenth Supplemental Indenture, dated as of March 31, 2022.

The 2025 5.00% Notes matured on March 31, 2025.

NMS Webster Note

On September 26, 2025, the Company’s wholly-owned subsidiary NMS repaid in full all of the outstanding obligations under the Webster Credit Agreement, dated as of November 8, 2018.

As a result, the Webster Credit Agreement and the other loan documents executed in connection therewith have been terminated, including the Parent Guaranty Agreement, dated as of November 8, 2018, by and between the Company and Webster Bank.

No early termination penalties were incurred by the Company or the Loan Parties as a result of the termination.

As a result of the termination, the Company recognized a $0.2 million loss on extinguishment of debt.

NMS Goldman Facility

On September 26, 2025, NMS and its wholly-owned subsidiary, Mobil Money, LLC (collectively, the “Borrowers”), together with NBSH Holdings, LLC, the direct sole member of NMS, as guarantor, entered into a Credit and Guaranty Agreement (the “Goldman Credit Agreement”), with Private Credit at Goldman Sachs Alternatives ("Goldman") as Administrative Agent and Collateral Agent thereunder and the lenders party thereto from time to time (the “Lenders”).

Pursuant to the terms of the Goldman Credit Agreement, the Lenders made available to the Borrowers term loans up to an aggregate principal amount of $90.0 million (the “Term Loans”) and a revolving facility up to an aggregate principal amount of $5.0 million (together with the Term Loans, collectively the “Goldman Facility”).

The Goldman Facility will mature on September 26, 2030.

At December 31, 2025, total principal outstanding was $88.4 million.

The Company incurred approximately $1.4 million of deferred financing costs in connection with the Goldman Facility.

SPV I, II, and III Facilities

The Company’s indirect subsidiaries SPV I, II, and III maintain credit facilities with third party lenders.

Newtek ALP Holdings’ subsidiaries (our indirect subsidiaries) SPV I, II, and III maintain credit facilities with third party lenders.

SPV I has a Capital One facility with maximum borrowings of $100.0 million.

The lender’s commitments terminate in May 2025, with all amounts due under the SPV I Facility maturing in November 2025.

Capital One’s commitment terminates in July 2027, with all amounts due under the SPV I Facility maturing in July 2028.

At December 31, 2025, total principal owed by SPV I was $16.6 million.

3 unchanged sentences

SPV III has a One Florida Bank facility with maximum borrowings of $35.0 million.

The One Florida Bank Facility matures in May 2025.

On August 7, 2025, the One Florida Bank Facility was amended and upsized to maximum borrowings of $35.0 million;

One Florida Bank’s facility matures in August 2028.

At December 31, 2025, total principal owed by SPV III was $33.3 million.

NMS Webster Bank Facility

NMS has a term loan facility with Webster Bank with an aggregate principal amount up to $ 54.9 million.

The Webster Facility matures in November 2027.

At December 31, 2024, total principal outstanding was $ 32.7 million.

Securitization Transactions

On April 23, 2025, the Company’s subsidiary Newtek ALP Holdings closed a securitization pursuant to which it sold $155.9 million of Class A Notes, $23.8 million of Class B Notes, and $4.3 million of a Class C Note (collectively, the “2025-1 Notes”) issued by NALP Business Loan Trust 2025-1 (the “2025-1Trust”).

The 2025-1 Notes were backed by $216.6 million of collateral, consisting of Newtek ALP Holdings originated ALP loans.

The Class A Notes received a Morningstar DBRS rating of “A (low) (sf)” and were priced at a yield of 6.338%;

the Class B Notes received a Morningstar DBRS rating of “BBB (sf)” and were priced at a yield of 7.838%;

and the Class C Note received a Morningstar DBRS rating of “BB (sf)” and was priced at a yield of 10.338%.

The 2025-1 Notes had a weighted average yield of 6.62% and an 85% advance rate.

The 2025-1 Trust meets the definition of a VIE and the Company holds a variable interest in the 2025-1 Trust, however, the Company is not considered the primary beneficiary of the 2025-1 Trust, because the power over the activities that have the most significant impact on the economic performance of the 2025-1 Trust is held by a single noteholder who has the ability to remove the Company as decision maker over the activities that most significantly impact the economic performance of the 2025-1 Trust.

Consequently the Company is not required to consolidate the 2025-1 Trust.

Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES for further detail.

From 2010 through June 2023, NSBF engaged in thirteen (13) securitizations of the unguaranteed portions of its SBA 7(a) loans.

7 unchanged sentences

The Class A and Class B notes bear interest at an average rate of 30-day average compounded SOFR plus 3.24% across both classes.

NSBF has the right to call the 2023-1 Class A and B notes at such time as the sum of the principal amount of the Class A Notes and the Class B Notes is less than or equal to 20.00% of the sum of the principal amount of the Class A Notes and Class B Notes as of the closing date of the transaction, with the prior written consent of the SBA.

At such time as the sum of the principal amount of the Class A Notes and the Class B Notes is less than or equal to 20.00% of the sum of the principal amount of the Class A Notes and Class B Notes as of the closing date of the transaction, NSBF has the right, with the consent of the SBA, to terminate the 2023-1 Trust by purchasing the 2023-1 Trust assets, with the Class A and B noteholders receiving the redemption price from the proceeds.

In September 2022, NSBF completed its twelfth securitization which resulted in the transfer of $116.2 million of unguaranteed portions of SBA loans to the 2022-1 Trust.

2 unchanged sentences

The Class A and Class B notes bear interest at an average rate of 30-day average compounded SOFR plus 2.97% across both classes.

NSBF has the right to call the 2021-1 Class A and B notes at such time as the sum of the principal amount of the Class A Notes and the Class B Notes is less than or equal to 20.00% of the sum of the principal amount of the Class A Notes and Class B Notes as of the closing date of the transaction, with the prior written consent of the SBA.

At such time as the sum of the principal amount of the Class A Notes and the Class B Notes is less than or equal to 20.00% of the sum of the principal amount of the Class A Notes and Class B Notes as of the closing date of the transaction, NSBF has the right, with the consent of the SBA, to terminate the 2022-1 Trust by purchasing the 2022-1 Trust assets, with the Class A and B noteholders receiving the redemption price from the proceeds.

In December 2021, NSBF completed its eleventh securitization which resulted in the transfer of $103.4 million of unguaranteed portions of SBA loans to the 2021-1 Trust.

2 unchanged sentences

The Class A and Class B notes bear interest at an average rate of adjusted SOFR plus 1.92% across both classes.

At such time as the sum of the principal amount of the Class A Notes and the Class B Notes is less than or equal to 20.00% of the sum of the principal amount of the Class A Notes and Class B Notes as of the closing date of the transaction, NSBF has the right, with the consent of the SBA, to terminate the 2021-1 Trust by purchasing the 2021-1 Trust assets, with the Class A and B noteholders receiving the redemption price from the proceeds.

In October 2019, NSBF completed its tenth securitization which resulted in the transfer of $118.9 million of unguaranteed portions of SBA loans to the 2019-1 Trust.

The 2019-1 Trust in turn issued securitization notes for the par amount of $118.9 million, consisting of $93.5 million of Class A notes and $25.4 million Class B notes, against the 2019-1 Trust assets in a private placement.

The Class A and Class B notes received an “A” and “BBB-” rating by S&P, respectively, and the final maturity date of the notes is December 2044.

The Class A and Class B notes bear interest at an average rate of adjusted SOFR plus 1.83% across both classes.

The 2019-1 Trust in turn issued securitization notes for the par amount of $118.9 million, consisting of $93.5 million of Class A notes and $25.4 million Class B notes, which received an “A” and “BBB-” rating by S&P, respectively.

In October, 2024, the 2019-1 Trust was terminated as a result of NSBF purchasing the 2019-1 Trust assets, with the 2019-1 Trust’s noteholders receiving the redemption price.

In November 2018, NSBF completed its ninth securitization which resulted in the transfer of $108.6 million of unguaranteed portions of SBA loans to the 2018-1 Trust.

The 2018-1 Trust in turn issued securitization notes for the par amount of $108.6 million, consisting of $82.9 million Class A notes and $25.7 million of Class B notes, against the assets in a private placement.

The Class A and Class B notes received an “A” and “BBB-” rating by S&P, respectively, and the final maturity date of the notes is February 2044.

The 2018-1 Trust in turn issued securitization notes for the par amount of $108.6 million, consisting of $82.9 million Class A notes and $25.7 million of Class B notes, which received an “A” and “BBB-” rating by S&P, respectively.

In October, 2024, the 2018-1 Trust was terminated as a result of NSBF purchasing the 2018-1 Trust assets, with the 2018-1 Trust’s noteholders receiving the redemption price.

In December 2017, NSBF completed its eighth securitization which resulted in the transfer of $76.2 million of unguaranteed portions of SBA loans to the 2017-1 Trust.

The 2017-1 Trust in turn issued securitization notes for the par amount of $75.4 million, consisting of $58.1 million Class A notes and $17.3 million of Class B notes, against the assets in a private placement.

The Class A and Class B notes received an “A” and “BBB-” rating by S&P, respectively, and the final maturity date of the notes is February 2043.

The 2017-1 Trust in turn issued securitization notes for the par amount of $75.4 million, consisting of $58.1 million Class A notes and $17.3 million of Class B notes, which received an “A” and “BBB-” rating by S&P, respectively.

On February 27, 2023, the 2017-1 Trust was terminated as a result of NSBF purchasing the 2017-1 Trust assets, with the 2017-1 Trust’s noteholders receiving the redemption price.

Cash Flows and Liquidity

The following table summarizes the Company’s available sources of liquidity as of December 31, 2024:

The following table summarizes the Company’s available sources of liquidity as of December 31, 2025 and December 31, 2024:

Availability as of

2 unchanged sentences

Lines of credit at other commercial banks 1

60,903 40,418

Interest bearing deposits in banks

4 unchanged sentences

Total liquidity sources $ 386,701 $ 483,831

1 Availability as of December 31, 2024 and 2023 is based on collateral pledged as of that date.

1 Availability as of December 31, 2025 and December 31, 2024 is based on collateral pledged as of that date.

The Company has restricted cash of $26.5 million as of December 31, 2025.

NSBF holds $6.7 million of the Company’s restricted cash, which includes reserves in the event payments are insufficient to cover interest and/or principal with respect to securitizations and loan principal and interest collected which are due to loan participants.

In addition, the Company has $10.0 million in a restricted cash account to fund certain of NSBF’s potential obligations to the SBA pursuant to the Wind-down Agreement.

In addition, the Company has funded a $10.0 million account to fund certain of NSBF’s potential obligations to the SBA pursuant to the Wind-down Agreement.

of which the Company is a guarantor.

The majority of the Company’s remaining restricted cash is related to payroll processing by PMT, our subsidiary.

The majority of the Company’s remaining restricted cash is held by the parent company.

The Company generated and used cash as follows:

Year Ended December 31, 2024 Year Ended

December 31, 2023

Year Ended December 31,

Net cash used in operating activities $ (579,241) $ (153,014)

1 unchanged sentence

Net cash provided by financing activities 753,450 560,897

Net increase in cash and restricted cash 198,832 3,520

Net (decrease) increase in cash and restricted cash (71,083) 198,832

Cash and restricted cash—beginning of period (NOTE 2)

Consolidation/(deconsolidation) of cash and restricted cash from controlled investments related to business combinations and dispositions, net of cash paid (1,464) 54,880

381,374 184,006

Deconsolidation of cash and restricted cash from controlled investments related to business dispositions

Cash and restricted cash—end of period (NOTE 2)

$ 310,291 $ 381,374

During the year ended December 31, 2025, operating activities used cash of $579.2 million, consisting primarily of $1.1 billion of funding loans held for sale.

This use of cash was offset by (i) $817.9 million of proceeds from the sale of loans;

and (ii) $140.0 million from the sale of loans from affiliates.

Cash used by investing activities was $209.1 million primarily comprised (i) $278.5 million in the net increase in loans held for investment, at cost and (ii) $25.7 million in contributions to joint ventures and other non-control investments and (iii) $33.0 million in purchases of available-for-sale securities.

These uses were partially offset by (i) a $66.8 million net decrease in loans held for investment, at fair value (ii) $20.3 million in returns of capital from joint ventures and other non-control investments and (iii) $41.5 million in maturities of available-for-sale securities.

Net cash provided by financing activities was $560.9 million consisting primarily of a (i) $508.6 million net increase in deposits;

(ii) $71.9 million of net proceeds from the 2029 8.50% Notes;

(iii) $75.0 million of net proceeds from the 2029 8.625% Notes, and (iv) $71.6 million net borrowings on bank notes payable.

These sources of cash were offset by (i) $107.0 million of principal payments related to securitization notes payable (ii) $38.3 million redemption of the 2024 Notes, and (iii) $20.3 million of dividends paid.

This use of cash was partially offset by (i) $404.5 million of proceeds from the sale of loans;

and (ii) $52.0 million from the payment of settlement receivables.

Cash used by investing activities was $245.3 million primarily comprised (i) $313.3 million in the net increase in loans held for investment, at cost;

(ii) $0.1 million in contributions to joint ventures and other investments;

and (iii) $19.9 million in purchases of available-for-sale securities.

These uses were partially offset by (i) a $71.8 million principal received on loans held for investment, at fair value;

and (ii) $27.7 million in maturities of available-for-sale securities.

Net cash provided by financing activities was $753.5 million consisting primarily of a (i) $531.2 million of borrowings on bank notes payable;

(ii) $444.4 million net increase in deposits;

(iii) $169.4 million of proceeds related to residuals in securitizations;

(iv) $48.2 million of proceeds from preferred stock, net of offering costs;

and (v) $32.0 million of proceeds from the 2030 Notes.

These sources of cash were partially offset by (i) $353.8 million repayment of bank notes payable;

(ii) $60.4 million of principal payments related to Notes Payable - Securitization Trusts;

(iii) $30.0 million maturity of the 2025 5.00% Notes;

and (iv) $28.0 million of dividends paid.

Contractual Obligations

The following table represents the Company’s obligations and commitments as of December 31, 2024.

Amounts represent principal only and are not shown net of unamortized debt issuance costs.

See NOTE 13—BORROWINGS.

Payments due by period

Contractual Obligations Total 2025 2026 2027 2028 2029 Thereafter

Demand $ 11,142 $ 11,142 $ — $ — $ — $ — $ —

Checking 103,978 103,978 — — — — —

Money market 62,001 62,001 — — — — —

Savings 386,680 386,680 — — — — —

Time deposits 409,251 351,906 36,347 20,180 680 138 —

Webster NMS Note 1

32,894 3,987 5,981 22,926 — —

FHLB Advances 15,330 7,982 2,094 5,254 — — —

SPV I Capital One Facility 1

21,300 21,300 — — — — —

SPV II Deutsche Bank Facility 1

54,800 — — 54,800 — — —

SPV III One Florida Bank Facility 1

23,075 23,075 — — — — —

Securitization Notes Payable 189,231 — — — — — 189,231

Parent Company Notes:

2025 5.00% Notes 30,000 30,000 — — — —

2026 Notes 115,000 — 115,000 — — —

50,000 — — 50,000 — —

2028 Notes 40,000 — — — 40,000 —

2029 8.625% Notes 75,000 — — — — 75,000 —

2029 8.50% Notes 71,875 — — — — 71,875 —

Employment Agreements 902 902 — — — — —

Operating Leases 8,264 2,383 2,355 798 242 249 2,237

Totals $ 1,700,723 $ 1,005,336 $ 161,777 $ 153,958 $ 40,922 $ 147,262 $ 191,468

1 Guaranteed by the parent company

2 Effective December 11, 2024, the Company entered into the Agreements with each of the holders of the 2025 8.125% Notes, pursuant to which the Company and the holders of the 2025 8.125% Notes agreed to exchange the 2025 8.125% Notes for the 2027 8.125% Notes, effecting amendments solely to (i) extend the February 1, 2025 maturity date of the 2025 8.125% Notes to the new maturity date of February 1, 2027 (the “New Maturity Date”) and (ii) provide that the 2027 8.125% Notes will be redeemable in whole, but not in part, at any time, at the option of the Company, from November 1, 2026 to the New Maturity Date, at a redemption price of 100% of the outstanding principal amount being redeemed plus any accrued but unpaid interest, to but excluding the redemption date.

The Company’s obligations and commitments representing required and potential cash outflows include demand deposits, time deposits, short-term and long-term advances from FHLB, unsecured senior notes, notes payable - securitization trusts, bank borrowings, operating leases and other commitments as of December 31, 2025.

Refer to “NOTE 11—DEPOSITS,” “NOTE 13—BORROWINGS,” and “NOTE 15—COMMITMENTS AND CONTINGENCIES.”

Unfunded Commitments

6 unchanged sentences

The Company is also a guarantor on certain of NSBF’s potential obligations to the SBA pursuant to the Wind-down Agreement.

Specifically, pursuant to the Wind-down Agreement, the Company has guaranteed NSBF’s obligations to the SBA for post-purchase repairs or denials on the guaranteed portion of 7(a) Loans sold by NSBF on the secondary market or servicing/liquidation post-purchase repairs or denial, and has funded a $10.0 million restricted cash account at Newtek Bank to secure these potential obligations.

Critical Accounting Policies and Estimates

6 unchanged sentences

ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels for disclosure purposes.

We consider our loans HFI, at fair value and HFS, at fair value to be Level 3 within the fair value hierarchy as described in Note 10.

We consider our loans HFI, at fair value and HFS, at fair value to be Level 3, with the exception of the guaranteed portion of SBA 7(a) loans HFS at FV which we categorize as Level 2, within the fair value hierarchy as described in Note 10.

Determining the fair value of the Level 3 loans held for sale and loans held for investment, which are measured at fair value requires management to make significant judgments about the valuation methodologies and inputs and assumptions used in the fair value calculation, including, but not limited to, historical credit losses, discounts for lack of marketability, underlying cash flows, and the impact of economic conditions.

On a quarterly basis, management determines the fair values of the retained unguaranteed portions of SBA 7(a) loans HFI, and unrealized changes in FV are recognized in the income statement.

The loans within this portfolio were originated by NSBF.

The loans within this portfolio were originated by NSBF and are currently originated by Newtek Bank.

NSBF ceased originating new loans in April 2023 when all new SBA 7(a) loan originations were transitioned to Newtek Bank.

2 unchanged sentences

SBA 504 loans HFS held at NALH are accounted for under the FV option.

Additionally, the existing government guaranteed portion of SBA 7(a) loans held at NSBF and certain SBA 504 loans held at Newtek Bank are also HFS at FV.

Additionally, the existing government guaranteed portion of SBA 7(a) loans and certain SBA 504 loans held at Newtek Bank are also HFS at FV.

The Company also originates ALP loans (formerly referred to as our nonconforming conventional loans), which are either HFS or HFI, via its nonbank subsidiary.

ALP loans are carried at FV.

ALP loans are held at NALH, NCL JV, and TSO JV and are also accounted for under the FV option.

ALP loans are held at NALH and TSO JV and are also accounted for under the FV option.

Allowance for Credit Losses

9 unchanged sentences

The reserve for unfunded commitments represents the expected credit losses on off-balance sheet commitments such as unfunded commitments to extend credit and standby letters of credit.

However, a liability is not recognized for commitments

unconditionally cancellable by the Company.

However, a liability is not recognized for commitments unconditionally cancellable by the Company.

The reserve for unfunded commitments is determined by estimating future draws and applying the expected loss rates on those draws.

13 unchanged sentences

For the fiscal year ended December 31, 2025, the Company accounted for servicing assets in accordance with ASC Topic 860-50 - Transfers and Servicing - Servicing Assets and Liabilities.

The Company and Newtek Bank earn servicing fees primarily from the guaranteed portions of SBA 7(a) loans and to a lesser extent ALP and SBA 504 loans they originate and sell.

The Company and Newtek Bank earn servicing fees primarily from the guaranteed portions of SBA 7(a), ALP, and SBA 504 loans they originate and sell.

13 unchanged sentences

Further information related to financial instruments can be found in NOTE 15—COMMITMENTS AND CONTINGENCIES.

Residuals in Securitizations, at Fair Value

The 2025-1 Notes were backed by $216.6 million of collateral, consisting of Newtek ALP Holdings originated ALP loans.

The Class A Notes received a Morningstar DBRS rating of “A (low) (sf)” and were priced at a yield of 6.338%;

the Class B Notes received a Morningstar DBRS rating of “BBB (sf)” and were priced at a yield of 7.838%;

and the Class C Note received a Morningstar DBRS rating of “BB (sf)” and was priced at a yield of 10.338%.

The 2025-1 Notes had a weighted average yield of 6.62% and an 85% advance rate.

The 2025-1 Trust meets the definition of a VIE and the Company holds a variable interest in the 2025-1 Trust, however, the Company is not considered the primary beneficiary of the 2025-1 Trust, because the power over the activities that have the most significant impact on the economic performance of the Securitization Trust is held by a single noteholder who has the ability to remove the Company as decision maker over the activities that most significantly impact the economic performance of the 2025-1 Trust.

Consequently the Company is not required to consolidate the 2025-1 Trust.

The Company’s beneficial interest in the 2025-1 Trust is evidenced by sole ownership of the Ownership Certificate and its beneficial interest in the credit risk of the securitized ALP Loans.

Newtek ALP Holdings, the sponsor of the Securitization Trust, is a wholly owned subsidiary of the Company, therefore the Company effectively owns 100% of the equity interest in the 2025-1 Trust.

Further information related to financial instruments can be found in NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES.

Recent Developments

On January 2, 2025, the Company completed the previously announced sale of its wholly owned subsidiary NTS to Paltalk, Inc.

(the “NTS Sale”), pursuant to the Agreement and Plan of Merger (the “Agreement”), dated as of August 11, 2024, by and among Paltalk, PALT Merger Sub 1, Inc., PALT Merger Sub 2, LLC, NTS and the Company.

Paltalk, Inc.

was subsequently renamed Intelligent Protection Management Corp.

(“IPM”) (Nasdaq:

As previously disclosed, in connection with the Company’s acquisition of Newtek Bank and transition to a financial holding company, the Company made a commitment to the Board of Governors of the Federal Reserve System to divest or terminate the activities of NTS.

Under the terms of the Agreement, at the closing of the NTS Sale, IPM acquired NTS for a combination of $4.0 million in cash, subject to certain purchase price adjustments (the “Cash Consideration”), and 4.0 million shares of a newly created series of IPM non-voting preferred stock, the Series A Non-Voting Common Equivalent Stock (the “Preferred Stock”) (the “Stock Consideration” and together with the Cash Consideration, the “Closing Consideration”).

Upon the occurrence of certain specified transfers of the Preferred Stock, each share of Preferred Stock will automatically convert into one share of common stock of IPM, subject to certain anti-dilution adjustments.

In addition to the Closing Consideration, the Company may be entitled to receive an earn-out amount of up to $5.0 million, payable in cash, Preferred Stock, or a combination thereof (as determined in IPM’s discretion), based on IPM's achievement of certain cumulative average Adjusted EBITDA thresholds for the 2025 and 2026 fiscal years.

Pursuant to the Agreement, following the closing of the NTS Sale, the Company is entitled to appoint one representative to the IPM board of directors.

The Company will account for our investment in IPM under ASC 321 beginning in the first quarter of 2025.

Securitization

On January 21, 2026, the Company’s subsidiary Newtek ALP Holdings closed a securitization pursuant to which it sold $251.9 million of Class A Notes, $35.9 million of Class B Notes, and $6.8 million of a Class C Note (collectively, the “2026-1 Notes”) issued by NALP Business Loan Trust 2026-1.

The Notes are backed by $341.8 million of collateral, consisting of $284.4 million of Company originated ALP loans and a prefunding account to acquire additional ALP loans originated by the Company.

The Class A Notes received a Morningstar DBRS rating of “A (low) (sf)” and were priced at a yield of 5.796%;

the Class B Notes received a Morningstar DBRS rating of “BBB (sf)” and were priced at a yield of 7.296%;

and the Class C Note received a Morningstar DBRS rating of “BB (sf)” and was priced at a yield of 10.146%.

The 2026-1 Notes had a weighted average yield of 6.08% and an 86% advance rate.

Exchange of 2026 Notes for 2031 Notes and Repayment of 2026 Notes

On January 28, 2026, the Company closed on its offer to exchange any and all of its 2026 Notes for its newly issued 2031 Notes, and thereby exchanged $7.9 million in aggregate principal amount of outstanding 2026 Notes for an equal principal amount of 2031 Notes.

The 2031 Notes bear interest at a rate of 8.50% per year payable quarterly on February 1, May 1, August 1 and November 1 of each year, will mature on February 1, 2031, and may be redeemed at the Company’s option, in whole or in part at any time or from time to time on or after February 1, 2028 at a redemption price of 100% of the outstanding principal amount of the 20231 Notes to be redeemed plus accrued and unpaid interest payments otherwise payable thereon for the then-current quarterly interest period accrued to, but excluding, the date fixed for redemption.

The 2031 Notes trade on the Nasdaq Global Market under the trading symbol “NEWTO.”

On February 1, 2026, the Company repaid the remaining $87.1 million aggregate principal amount of 2026 Notes outstanding on the 2026 Notes maturity date.

Issuance of 2033 Notes

On February 18, 2026, the Company completed an exempt offering of $15.0 million aggregate principal amount of its 8.375% note due 2033 (the “ 2033 Notes” and the "Offering").

The Offering was consummated pursuant to the terms of a purchase agreement (the “Purchase Agreement”) dated February 17, 2026 between the Company and an institutional accredited investor (the “Purchaser”).

The Purchase Agreement provided for the Note to be issued to the Purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”).

The Company relied upon this exemption from registration based in part on representations made by the Purchaser.

The 2033 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration.

The net proceeds from the sale of the 2033 Notes were approximately $14.9 million.

The Company intends to use the net proceeds from the sale of the 2033 Notes for general corporate purposes.

The 2033 Notes will mature on March 1, 2033.

The 2033 Notes may be redeemed by the Company, at its option, at a make-whole price at any time prior to January 1, 2033, or at a price equal to 100% of the principal amount of the 2033 Notes to be redeemed, plus accrued and unpaid interest, if any, thereafter.

The 2033 Notes bear interest at a rate of 8.375% per year payable semiannually on February 1 and August 1 each year, beginning on August 1, 2026.

The 2033 Notes will be the Company’s direct unsecured obligation and ranks pari passu, or equal, with all outstanding and future unsecured unsubordinated indebtedness issued by the Company.

The 2033 Notes will be effectively subordinated to the Company’s existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries.

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 7. Management’s Discussion and Analysis