What changed in this filing

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Item 1A. Risk Factors

2025-11-18 compared with 2025-02-21 · 28 added, 26 removed, 5 unchanged (92% of the section changed)

1 unchanged sentence

There are certain risks and uncertainties in our business that could cause our actual results to differ materially from those anticipated.

A detailed discussion of our risk factors was included in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on April 24, 2024.

A detailed discussion of our risk factors was included in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024.

These risk factors should be read carefully in connection with evaluating our business and in connection with the forward-looking statements and other information contained in this Quarterly Report on Form 10-Q.

1 unchanged sentence

Except as set forth below, there have been no material changes to the risk factors set forth in the Annual Report on Form 10-K for the year ended December 31, 2024.

Recent events and developments related to our investment in Freedom VCM and our prior business relationship with Brian Kahn and related to the SEC subpoenas we received may continue to have adverse effects on our business, results of operations, reputation, and stock price.

As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report”), we are subject to risks associated with our investment in Freedom VCM and our prior business relationship with Brian Kahn—see “Item 1 – Legal Proceedings”.

The Company and members of our Board of Directors have been named in putative class action lawsuits related to these matters, and in July 2024 and November 2024 each of the Company and Mr.

Riley received a subpoena from the SEC requesting the production of certain documents.

See “Recent Developments – SEC Subpoena”.

We expect that the Company may be subject to additional lawsuits and other claims related to these matters.

In addition, in July 2024, Conn’s and certain of its subsidiaries filed voluntary petitions for relief (the “Chapter 11 Cases”) under chapter 11 of the Bankruptcy Code.

FRG, pursuant to a transaction consummated in January 2024, acquired a substantial equity investment in Conn’s, and in December 2023, the Company loaned $108.0 million to Conn’s

subsequently reduced to $93.0 million due to principal repayments.

The fair value of this loan receivable is $63.7 million at September 30, 2024.

On November 3, 2024, FRG, its operating businesses, and certain other affiliates, including Freedom VCM, filed voluntary petitions for relief (the “FRG Chapter 11 Cases”) under chapter 11 of the Bankruptcy Code.

As a result, on November 4, 2024, we concluded that we were required to record an additional impairment with respect to the Freedom VCM Investment and the Vintage Loan Receivable.

The non-cash impairments of the Freedom VCM Investment and the Vintage Loan Receivable are $118.0 million in the aggregate as of November 4, 2024.

As a result of such additional impairment we have ascribed no value to the Freedom VCM Investment as of September 30, 2024 and a value of $2.2 million to the Vintage Loan Receivable as of February 7, 2025.

We expect that the Company may be subject to lawsuits and other claims related to the Conn’s Chapter 11 Cases and the FRG Chapter 11 Cases.

See “Recent Developments—Conn’s and FRG”.

These events and developments have exacerbated, and they and additional similar events and developments including additional litigation and claims will continue to exacerbate, the risk that we will continue to:

(i) incur expenses in connection with these matters, which expenses may be material and, in some cases, are not or will not be covered by insurance;

(ii) harm our reputation and negatively impact employee morale and retention;

(iii) lose customers or negative impact on our ability to attract new customers and increased competition for new clients and business;

and (iv) result in additional write-downs, which may be material.

Unregistered Sales of Equity Securities and Use of Proceeds.

Defaults Upon Senior Securities.

Mine Safety Disclosures.

Not applicable.

If we are unable to satisfy the applicable continued listing requirements of Nasdaq, our securities could be delisted.

Our shares of common stock and preferred stock, and our senior notes (collectively, our “Securities”) are listed on the Nasdaq Global Market.

Generally, among other requirements, we must timely file all required periodic financial reports with the SEC.

As previously disclosed, on October 1, 2025, the Company received a Staff Determination Letter from the Nasdaq Listing Qualifications Staff (the “Staff”) based on the Company's non-compliance with Nasdaq Listing Rule 5250(c)(1) (the “Filing Rule”), as previously notified by the Staff on April 3, 2025, May 21, 2025 and August 20, 2025.

The basis for the Staff Determination Letter was that the Company had not yet filed its Quarterly Reports on Form 10-Q for the periods ended March 31, 2025 and June 30, 2025 (the “Q2 Delayed Report”), with the Securities and Exchange Commission (the “SEC”).

The Company filed its Form 10-K for the fiscal year ended December 31, 2024 (the “2024 Form 10-K”) on September 19, 2025 and is actively working towards the filing of the Q2 Delayed Report and the timely filing of its Quarterly Report on Form 10-Q for the period ended September 30, 2025 to ensure full compliance with the Listing Rules.

The Staff Determination Letter noted that, after the Staff’s review of the materials submitted by the Company on September 4, 2025 and September 19, 2025 (the “Updated Plan of Compliance”), it lacked the discretion within Nasdaq’s rules to grant the Company a further exception beyond the September 29, 2025 deadline that was previously granted to regain compliance with the Filing Rule.

The Staff Determination Letter has no immediate effect and will not immediately result in the suspension of trading or delisting of the Company’s securities.

The Staff Determination Letter notified the Company that it may request a hearing before a Nasdaq Hearings Panel (“Hearings Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series.

A request for a hearing regarding one or more delinquent filings will automatically stay the suspension of the Company’s securities for a period of at least 15 calendar days from the date of the hearing request.

By Nasdaq rule, when a company requests a hearing for one or more late SEC periodic public filings, it must also request an extension of the stay through the hearing date and subsequently during any additional extension period granted by a Hearings Panel following the hearing.

Hearings are typically scheduled to occur approximately 30-45 days after the date of the hearing request.

The Company timely submitted a request for a hearing on October 8, 2025, including continued listing of its securities pending the hearing and the Hearings Panel’s decision.

There can be no assurance that the Hearings Panel will grant any of the Company’s requests for additional time.

In the unlikely event that there is no ruling on the stay of a suspension prior to the expiration of the automatic stay, it has been Nasdaq’s practice to take no action until a Hearings Panel makes a ruling on the extended stay request.

Once the Hearings Panel makes a ruling on the extended stay, the Company intends to make a public announcement.

A hearing before the Hearings Panel was held on November 4, 2025.

The Company anticipates receiving a determination from the Hearings Panel within 30 days following the date of the hearing.

There can be no assurance that the Hearings Panel will grant our request for reconsideration, that any appeal will be successful with the Hearings Panel, or that we will be able meet the continued listing requirements if we are permitted to continue trading on Nasdaq.

Even if the Hearing Panel grants us additional time to file the Q2 Delayed Report and we meet all terms of any exception to the Nasdaq Filing Rule afforded by the Hearings Panel, there can be no assurance that we will be able to timely file the required reports or meet other continued listing requirements in the future.

If Nasdaq delists our Securities from trading on its exchange, we expect our Securities could be quoted on an over-the-counter market.

If this were to occur, we could face significant material adverse consequences, including:

• limited availability of market quotations for our Securities;

• reduced liquidity for our Securities;

• a determination that our shares of common and/or preferred stock is a “penny stock” which will require brokers trading in our Securities to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

• a limited amount of news and analyst coverage;

• a decreased ability to issue additional securities or obtain additional financing in the future.

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-Q

Item 1A. Risk Factors