On November 13, 2023, the Company entered into the Purchase Agreement with Westlake Financial, pursuant to which the Company agreed to sell substantially all of its finance receivables and all of its repossessed assets. In connection with

the entering into the Purchase Agreement, the Company ceased new loan originations of contracts and direct loans. On April 26, 2024, the transactions contemplated by the Purchase Agreement closed with an aggregate purchase price of $65.6 million, pursuant to the terms of the Purchase Agreement. Pursuant to the terms of the Purchase Agreement, Westlake Financial was due to make additional payments to the Company based on a percentage of cash collections received over a predetermined threshold on the loan portfolio from September 30, 2023 through the closing of the disposition. On April 26, 2024, Westlake Financial made a $40.6 million payment to the Company at the closing of the disposition.

Subsequent to closing, the Company and Westlake Financial determined that Westlake Financial overpaid the Company $2.6 million. The Company accordingly recorded a $2.6 million contingent liability while negotiations took place until a settlement could be reached on the established contingent consideration.

On July 25, 2024, the arrangement between the Company and Westlake regarding a reconciliation of the initial payment to Nicholas Financial, escrow, and contingent consideration was settled, which resulted in the Company paying Westlake Financial $2.4 million and waiving the right to any future contingent payments from Westlake Financial as originally stated in the Purchase Agreement. As a result of the sale of the Company's finance receivables and repossessed assets to Westlake, the Company recognized a gain of $1.7 million, calculated as the excess of the total consideration over the carrying value of the finance receivables and repossessed assets sold to Westlake. The disposition of the finance receivables and all of its repossessed assets represents a strategic shift in the business based on the total assets, revenue, and net income of the segment sold to Westlake in comparison to the financial information of the Company as a whole.

The following depicts the results of operations for the discontinued operations of the Company for the three and nine months ended December 31, 2024 and 2023:


	For the Three Months Ended December 31,						For the Nine Months Ended December 31,
(In thousands)	2024			2023			2024			2023
Revenue
Interest and fee income on finance receivables	$	-		$	4,954		$	1,229		$	18,367
Total revenue		-			4,954			1,229			18,367

Operating expenses
Marketing		-			22			6			88
Provision for credit losses		-			(10,482	)		-			2,570
Fair value and other adjustments, net		(202	)		23,110			(230	)		23,110
General and administrative		17			2,198			823			7,518
Total operating expenses		(185	)		14,848			599			33,286

Gain on disposal of assets, net of taxes		-			-			(1,692	)		-
Gain on sale of finance receivables, net of taxes		(94	)		-			(817	)		-

Income before income taxes		279			(9,962	)		3,139			(15,745	)
Income tax benefit		-			-			-			-
Net income (loss) from discontinued operations, net of taxes	$	279		$	(9,962	)	$	3,139		$	(15,745	)