10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10‑Q

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March  31, 2018
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to                  to

Commission File Number: 001‑35537

COMMUNITY CHOICE FINANCIAL INC.

(Exact name of registrant as specified in its charter)

Ohio (State or other jurisdiction of incorporation or organization)	45‑1536453 (IRS Employer Identification No.)
6785 Bobcat Way, Suite 200, Dublin, Ohio (Address of principal executive offices)	43016 (Zip Code)

(888) 513‑9395

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S‑T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒   No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ◻	Accelerated filer ◻
Non-accelerated filer   ☒	Smaller reporting company ◻
(Do not check if a smaller reporting company)	Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12‑b‑2 of the Act.) Yes ☐  No ☒

There is no market for the registrant’s equity. As of March 31, 2018, there were 7,990,020 shares outstanding.

Community Choice Financial Inc. and Subsidiaries

Form 10-Q for the Quarterly Period Ended March  31, 2018

Table of Contents

		Page
	Financial Information
Item 1.	Financial Statements
	Consolidated Balance Sheets as of March 31, 2018 (unaudited) and December 31, 2017	3
	Consolidated Statements of Operations for the three months ended March 31, 2018 (unaudited) and March 31, 2017 (unaudited)	4
	Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2018 (unaudited)	5
	Consolidated Statements of Cash Flows for the three months ended March 31, 2018 (unaudited) and March 31, 2017 (unaudited)	6
	Notes to unaudited Consolidated Financial Statements	7-26
Item 2.	Management’s Discussion and Analysis of Financial Condition and Result of Operations	27-39
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	39
Item 4.	Controls and Procedures	39
Part II	Other Information	41
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 6.	Exhibits	41
	Signatures	42

2

Community Choice Financial Inc. and Subsidiaries

Consolidated Balance Sheets

March 31, 2018 and December 31, 2017

(In thousands, except per share data)

	March 31,		December 31,
	2018		2017
	(unaudited)
Assets
Current Assets
Cash and cash equivalents	$	85,274	$	66,627
Restricted cash		4,420		4,585
Finance receivables, net of allowance for loan losses of $12,293 and $13,517		68,286		89,707
Card related pre-funding and receivables		841		1,062
Other current assets		13,522		15,271
Total current assets		172,343		177,252
Noncurrent Assets
Finance receivables, net of allowance for loan losses of $2,510 and $2,810		3,626		4,632
Property, leasehold improvements and equipment, net		24,816		26,848
Other intangible assets		802		924
Security deposits		2,429		2,750
Total assets	$	204,016	$	212,406
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	31,803	$	39,566
Money orders payable		8,024		7,169
Accrued interest		11,942		5,145
Current portion of capital lease obligation		160		371
Current portion of subsidiary notes payable, net of deferred issuance costs of $1 and $1		120		118
Deferred revenue		2,535		2,535
Total current liabilities		54,584		54,904
Noncurrent Liabilities
Lease termination payable		569		818
Line of credit, net of deferred issuance costs of $4,201 and $1,871		42,799		45,129
Subsidiary notes payable, net of deferred issuance costs of $2,207 and $762		59,600		61,077
Senior secured notes, net of deferred issuance costs of $1,365 and $1,664		248,425		248,126
Deferred revenue		6,887		7,520
Total liabilities		412,864		417,574
Commitments and Contingencies
Stockholders' Equity
Preferred stock, par value $.01 per share, 3,000 shares authorized, no shares issued and outstanding		—		—
Common stock, par value $.01 per share, 300,000 authorized shares and 7,990 outstanding shares at March 31, 2018 and December 31, 2017		90		90
Additional paid-in capital		129,683		129,675
Retained deficit		(338,571)		(334,883)
Treasury stock		(50)		(50)
Total stockholders' deficit		(208,848)		(205,168)
Total liabilities and stockholders' equity	$	204,016	$	212,406

See Notes to Unaudited Consolidated Financial Statements.

3

Community Choice Financial Inc. and Subsidiaries

Consolidated Statements of Operations

Three Months Ended March  31, 2018 and 2017

(In thousands)

(Unaudited)

	Three Months Ended
	March 31,
	2018		2017
Revenues:
Finance receivable fees	$	50,932	$	49,051
Credit service fees		19,196		18,139
Check cashing fees		11,692		12,126
Card fees		1,948		2,007
Other		3,883		4,029
Total revenues		87,651		85,352
Operating expenses:
Salaries		17,132		17,273
Provision for loan losses		22,635		19,540
Occupancy		6,343		6,629
Advertising and marketing		1,011		814
Lease termination		97		47
Depreciation and amortization		2,223		2,538
Other		11,025		11,915
Total operating expenses		60,466		58,756
Operating gross profit		27,185		26,596
Corporate and other expenses:
Corporate expenses		17,602		20,186
Lease termination		—		1,762
Depreciation and amortization		1,093		1,309
Interest expense, net		12,178		11,371
Total corporate and other expenses		30,873		34,628
Loss from continuing operations, before tax		(3,688)		(8,032)
Provision for income taxes		—		333
Net loss	$	(3,688)	$	(8,365)

See Notes to Unaudited Consolidated Financial Statements.

4

Community Choice Financial Inc. and Subsidiaries

Consolidated Statements of Stockholders’ Equity

Three Months Ended March  31, 2018 

(Dollars in thousands)

(Unaudited)

						Additional
	Common Stock			Treasury		Paid-In		Retained
	Shares	Amount		Stock		Capital		Deficit		Total
Balance, December 31, 2017	7,990,020	$	90	$	(50)	$	129,675	$	(334,883)	$	(205,168)
Stock-based compensation expense	—		—		—		8		—		8
Net loss	—		—		—		—		(3,688)		(3,688)
Balance, March 31, 2018	7,990,020	$	90	$	(50)	$	129,683	$	(338,571)	$	(208,848)

See Notes to Unaudited Consolidated Financial Statements.

5

Community Choice Financial Inc. and Subsidiaries

Consolidated Statements of Cash Flows

Three Months Ended March  31, 2018 and 2017

(In thousands)

(Unaudited)

	Three Months Ended
	March 31,
	2018		2017
Cash flows from operating activities
Net loss	$	(3,688)	$	(8,365)
Adjustments to reconcile net loss to net cash provided by operating activities:
Provision for loan losses		22,635		19,540
Loss on disposal of assets		113		1,042
Depreciation		3,193		3,723
Amortization of note discount and deferred debt issuance costs		908		728
Amortization of intangibles		123		124
Deferred income taxes		—		211
Stock-based compensation		8		32
Changes in assets and liabilities:
Short-term investments		—		500
Card related pre-funding and receivables		221		(184)
Other assets		2,069		6,590
Deferred revenue		(633)		(475)
Accrued interest		6,797		6,793
Money orders payable		855		(378)
Lease termination payable		(249)		1,048
Accounts payable and accrued expenses		(7,763)		(8,729)
Net cash provided by operating activities		24,589		22,200
Cash flows from investing activities
Net receivables originated		(208)		(2,721)
Purchase of leasehold improvements and equipment		(1,274)		(1,001)
Net cash used in investing activities		(1,482)		(3,722)
Cash flows from financing activities
Payments on subsidiary note		(30)		(29)
Payments on capital lease obligations		(211)		(248)
Net payments on lines of credit		—		(2,250)
Debt issuance costs		(4,384)		—
Net cash used in financing activities		(4,625)		(2,527)
Net increase in cash and cash equivalents and restricted cash		18,482		15,951
Cash and cash equivalents and restricted cash:
Beginning		71,212		109,348
Ending	$	89,694	$	125,299
The following table reconciles cash and cash equivalents and restricted cash from the
Consolidated Balance Sheets to the above statements:
	December 31,
	2017		2016
Cash and cash equivalents	$	66,627	$	106,333
Restricted Cash		4,585		3,015
Total cash and cash equivalents and restricted cash	$	71,212	$	109,348
	March 31,
	2018		2017
Cash and cash equivalents	$	85,274	$	121,784
Restricted Cash		4,420		3,515
Total cash and cash equivalents and restricted cash	$	89,694	$	125,299

See Notes to Unaudited Consolidated Financial Statements.

6

Community Choice Financial Inc. and Subsidiaries

Notes to Unaudited Consolidated Financial Statements

(Dollars in thousands, except per share data)

Note 1. Ownership, Nature of Business, and Significant Accounting Policies

Nature of business:  Community Choice Financial Inc. (together with its consolidated subsidiaries, “CCFI” or “the Company”) owned and operated 484 retail locations in 12 states and was licensed to deliver similar financial services over the internet in 30 states as of March 31, 2018. Through its network of retail locations and over the internet, the Company provides customers a variety of financial products and services, including secured and unsecured, short and medium‑term consumer loans, check cashing, prepaid debit cards, and other services that address the specific needs of its individual customers.

A summary of the Company’s significant accounting policies follows:

Basis of presentation:  The accompanying interim unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10‑Q and accounting principles generally accepted in the United States (“GAAP”) for interim financial information. They do not include all information and footnotes required by GAAP for complete financial statements. Although management believes that the disclosures are adequate to prevent the information from being misleading, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2017, included in the Company’s Annual Report on Form 10‑K filed with the Securities & Exchange Commission on April 2, 2018. All adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial condition, have been included. The results for any interim period are not necessarily indicative of results to be expected for the year ending December 31, 2018.

Basis of consolidation:  The accompanying consolidated financial statements include the accounts of CCFI. All significant intercompany accounts and transactions have been eliminated in consolidation.

Business segments:  FASB Accounting Standards Codification (“ASC”) Topic 280 Segment Reporting requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way operating segments were determined and other items. The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in determining how to allocate resources and assess performance. The Company operates in two segments: Retail financial services and Internet financial services.

Equity method investments:    Entities and investments over which the Company exercises significant influence over the activities of the entity but which do not meet the requirements for consolidation are accounted for using the equity method of accounting pursuant to ASC 323, whereby the Company records its share of the underlying income or loss of these entities. Intercompany profit arising from transactions with affiliates is eliminated to the extent of its beneficial interest. Equity in losses of equity method investments is not recognized after the carrying value of an investment, including advances and loans, has been reduced to zero, unless guarantees or other funding obligations exist.

On September 30, 2017, the Company entered into a joint venture with a third party to offer insurance products through select retail locations in a certain market. The joint venture will be managed by the third party.

Revenue recognition:  Transactions include loans, credit service fees, check cashing, bill payment, money transfer, money order sales, and other miscellaneous products and services. The full amount of the check cashing fee is recognized as revenue at the time of the transaction. Fees and direct costs incurred for the origination of loans are deferred and amortized over the loan period using the interest method. The Company acts in an agency capacity regarding bill payment services, money transfers, card products, and money orders offered and sold at its retail locations.

7

The Company records the net amount retained as revenue because the supplier is the primary obligor in the arrangement, the amount earned by the Company is fixed, and the supplier is determined to have the ultimate credit risk. Revenue on loans determined to be troubled debt restructurings are recognized at the impaired loans’ original interest rates until the impaired loans are charged off or paid by the customer. Credit service organization (“CSO”) fees are recognized over the arranged credit service period.

Finance receivables:  Finance receivables consist of short term and medium‑term consumer loans.

Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term loan products typically range in principal from $100 to $1,000, with a maturity between fourteen and thirty days, and include a written agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations, which vary by state. State statutes vary from charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advance by making cash payments or allowing a check or preauthorized debit to be presented. Secured consumer loans with a maturity of ninety days or less are included in this category and represented 14.0% and 14.5% of short-term consumer loans at March 31, 2018 and December 31, 2017, respectively.

Medium-term consumer loans can be unsecured or secured with a maturity greater than ninety days and up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000, and are evidenced by a promissory note with a maturity between three and thirty-six months. These consumer loans vary in structure depending upon the applicable laws and regulations where they are offered. The medium-term consumer loans are payable in installments or provide for a line of credit with periodic payments. Secured consumer loans with a maturity greater than ninety days are included in this category and represented 14.0% and 12.6% of medium-term consumer loans at March 31, 2018, and December 31, 2017, respectively.

Allowance for loan losses:  Provisions for loan losses are charged to income in amounts sufficient to maintain an adequate allowance for loan losses and an adequate accrual for losses related to guaranteed loans processed for third-party lenders under the CSO programs. The factors used in assessing the overall adequacy of the allowance for loan losses, the accrual for losses related to guaranteed loans made by third-party lenders and the resulting provision for loan losses include an evaluation by product, by market based on historical loan loss experience, and delinquency of certain medium-term consumer loans. The Company evaluates various qualitative factors that may or may not affect the computed initial estimate of the allowance for loan losses, by using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions.

For short term unsecured consumer loans, the Company’s policy is to charge off loans when they become past due. The Company’s policy dictates that, where a customer has provided a check or ACH authorization for presentment upon the maturity of a loan, if the customer has not paid off the loan by the due date, the Company will deposit the customer’s check or draft the customer’s bank account for the amount due. If the check or draft is returned as unpaid, all accrued fees and outstanding principal are charged-off as uncollectible. For short term secured loans, the Company’s policy requires that balances be charged off when accounts are either thirty or sixty days past due depending on the product.

For medium term secured and unsecured consumer loans that have a term of one year or less, the Company’s policy requires that balances be charged off when accounts are sixty days past due. For medium term secured and unsecured consumer loans that have an initial maturity of greater than one year, the Company’s policy requires that balances be charged off when accounts are ninety-one days past due.

In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. These reduced interest rates and changed payment terms were limited to loans that the Company believed the customer had the ability to pay in the foreseeable future. These loans were accounted for as troubled debt restructurings and represent the only loans considered impaired due to the nature of the Company’s charge-off policy.

8

Recoveries of amounts previously charged off are recorded to the allowance for loan losses or the accrual for third‑party losses in the period in which they are received.

Lease termination payable:  The Company records a liability in the consolidated balance sheets for the remaining lease obligations with the corresponding lease termination expense for closed retail locations disclosed in the operating expenses section, and closed corporate locations disclosed in the corporate and other expenses section, of the consolidated statements of operations, respectively.

Fair value of financial instruments:  Financial assets and liabilities measured at fair value are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are:

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

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

· Level 3—Unobservable inputs for assets and liabilities reflecting the reporting entity’s own assumptions.

The Company follows the provisions of ASC 820‑10, Fair Value Measurements and Disclosures, which applies to all assets and liabilities that are being measured and reported on a fair value basis. ASC 820‑10 requires a disclosure that establishes a framework for measuring fair value within GAAP and expands the disclosure about fair value measurements. This standard enables a reader of consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The standard requires that assets and liabilities carried at fair value be classified and disclosed in one of the three categories.

In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820-10. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The Company’s financial instruments consist primarily of cash and cash equivalents, finance receivables, restricted cash, and lines of credit. For all such instruments, other than senior secured notes and notes payable at March 31, 2018, and December 31, 2017, the carrying amounts in the consolidated financial statements approximate their fair values. Finance receivables are short term in nature and are originated at prevailing market rates and lines of credit bear interest at current market rates. The fair value of finance receivables at March 31, 2018 and December 31, 2017 approximates carrying value and is measured using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. 

9

The fair value of the Company’s 10.75% senior secured notes due 2019 (the “2019 notes”) and the 12.75% senior secured notes due 2020 (the “2020 notes”) were determined based on market yield on trades of the 2019 notes at the end of the recent reporting period.

	March 31, 2018
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	85,274	$	85,274	1
Restricted cash		4,420		4,420	1
Finance receivables		71,912		71,912	3
Financial liabilities:
10.75% Senior secured notes		237,290		222,103	1
12.75% Senior secured notes		12,500		11,479	2
Subsidiary Note payable		61,928		61,928	2
Line of Credit		47,000		47,000	2

	December 31, 2017
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	66,627	$	66,627	1
Restricted cash		4,585		4,585	1
Finance receivables		94,339		94,339	3
Financial liabilities:
10.75% Senior secured notes		237,290		212,636	1
12.75% Senior secured notes		12,500		10,841	2
Subsidiary Note payable		61,958		61,958	2
Line of Credit		47,000		47,000	2

Treasury Stock:  Treasury stock is reported at cost and consists of one million common shares at March 31, 2018 and December 31, 2017.

Recent Accounting Pronouncements:  In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective method. The adoption of ASC 606 did not impact the Company’s revenue recognition for consumer loan fees as these revenue streams are outside of the scope of ASC 606. Further, the Company has not identified any impacts to its consolidated financial statements that were material as a result of the adoption of ASC 606 for its CSO fees. The Company has not changed the presentation of its consolidated financial statements for assets, liabilities, or revenues from contracts with customers, nor has the Company recognized any cumulative effect adjustment as a result of the adoption of ASC 606.

In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash”. GAAP currently does not include specific guidance to address how to classify and present changes in restricted cash or restricted cash equivalents that occur when there are transfers between cash, cash equivalents, and restricted cash or restricted cash equivalents and when there are direct cash receipts into restricted cash or restricted cash equivalents or direct cash payments made from restricted cash or restricted cash equivalents. The amendments in this update require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash 

10

equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update do not provide a definition of restricted cash or restricted cash equivalents. For public business entities the amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted the new standard effective in 2018. As a result, the Company no longer reports the changes in restricted cash as an operating activity. Instead, restricted cash is included in the beginning and ending cash and cash equivalents balances on the consolidated statements of cash flows.

Subsequent events:  The Company has evaluated its subsequent events (events occurring after March 31, 2018) through the issuance date of May 14, 2018.

Note 2. Finance Receivables, Credit Quality Information and Allowance for Loan Losses

Finance receivables representing amounts due from customers for advances at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31,		December 31,
	2018		2017
Short-term consumer loans	$	52,115	$	66,465
Medium-term consumer loans		36,860		46,903
Gross receivables	$	88,975	$	113,368
Unearned advance fees, net of deferred loan origination costs		(2,260)		(2,702)
Finance receivables before allowance for loan losses		86,715		110,666
Allowance for loan losses		(14,803)		(16,327)
Finance receivables, net	$	71,912	$	94,339
Finance receivables, net
Current portion	$	68,286	$	89,707
Non-current portion		3,626		4,632
Total finance receivables, net	$	71,912	$	94,339

Changes in the allowance for loan losses by product type for the three months ended March 31, 2018, are as follows:

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2018		Provision		Charge-Offs		Recoveries		3/31/2018		3/31/2018		of receivables
Short-term consumer loans	$	2,697	$	8,159	$	(18,424)	$	9,886	$	2,318	$	52,115	4.45	%
Medium-term consumer loans		13,630		8,397		(11,067)		1,525		12,485		36,860	33.87	%
	$	16,327	$	16,556	$	(29,491)	$	11,411	$	14,803	$	88,975	16.64	%

The provision for loan losses for the three months ended March 31, 2018, also includes losses from returned items from check cashing of $1,062.

The provision for short-term consumer loans of $8,159 is net of debt sales of $412 for the three months ended March 31, 2018.

The provision for medium-term consumer loans of $8,397 is net of debt sales of $562 for the three months ended March 31, 2018.

The Company evaluates all short-term and medium-term consumer loans collectively for impairment, except for individually evaluating medium-term loans that have been modified and classified as troubled debt restructurings. In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. The provision and subsequent charge off related to these loans totaled $20 and is included in the provision for medium-term consumer loans for the three months ended

11

March 31, 2018. For these loans evaluated for impairment, there were $54 of payment defaults during the three months ended March 31, 2018. The troubled debt restructurings during the three months ended March 31, 2018 are subject to an allowance of $6 with a net carrying value of $14 at March 31, 2018.

Changes in the allowance for loan losses by product type for the three months ended March 31, 2017, are as follows:

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2017		Provision		Charge-Offs		Recoveries		3/31/2017		3/31/2017		of receivables
Short-term consumer loans	$	2,223	$	6,433	$	(19,134)	$	12,324	$	1,846	$	51,325	3.60	%
Medium-term consumer loans		13,996		7,221		(11,979)		1,925		11,163		41,185	27.10	%
	$	16,219	$	13,654	$	(31,113)	$	14,249	$	13,009	$	92,510	14.06	%

The provision for loan losses for the three months ended March 31, 2017, also includes losses from returned items from check cashing of $1,399.

The provision for short-term consumer loans of $6,433 is net of debt sales of $89 for the three months ended March 31, 2017.

The provision for medium-term consumer loans of $7,221 is net of debt sales of $375 for the three months ended March 31, 2017.

The provision and subsequent charge off related to troubled debt restructurings totaled $13 and is included in the provision for medium-term consumer loans for the three months ended March 31, 2017. For these loans evaluated for impairment, there were no payment defaults during the three months ended March 31, 2017. The troubled debt restructurings during the three months ended March 31, 2017 are subject to an allowance of $5 with a net carrying value of $15 at March 31, 2017.

The Company has subsidiaries that facilitate third-party lender loans. Changes in the accrual for third-party lender losses for the three months ended March 31, 2018, and 2017 were as follows:

	Three Months Ended March 31,
	2018		2017
Short-term balance, beginning of period	$	4,570	$	2,907
Provision for loan losses		4,938		4,428
Charge-offs, net		(5,928)		(4,764)
Short-term balance, end of period	$	3,580	$	2,571
Medium-term balance, beginning of period	$	248	$	192
Provision for loan losses		79		59
Charge-offs, net		(139)		(131)
Medium-term balance, end of period	$	188	$	120
Total balance, beginning of period	$	4,818	$	3,099
Provision for loan losses		5,017		4,487
Charge-offs, net		(6,067)		(4,895)
Total balance, end of period	$	3,768	$	2,691

Total gross finance receivables for which the Company has recorded an accrual for third‑party lender losses totaled $29,575 and $36,967 at March 31, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off‑balance sheet arrangement.  The total gross finance receivables consist of $28,646 and $35,801 in short-term and $929 and $1,166 in medium-term loans at March 31, 2018 and December 31,2017, respectively. The provision for third party lender losses of $5,017 for the three months ending March 31, 2018 is net of

12

debt sales of $210. The provision for third party lender losses of $4,487 for the three months ending March 31, 2017 is net of debt sales of $181, respectively.

The Company was required to purchase $16,840 and $11,568 of short-term loans and $199 and $204 of medium-term loans as part of the CSO Program during the three months ended March 31, 2018 and 2017, respectively. As these loans were in default when purchased, they met the Company’s policy and were fully charged-off at acquisition. The Company recognized recoveries of $11,279 and $7,146 of short-term and $59 and $73 of medium-term collections on these loans    during the three months ended March 31, 2018 and 2017, respectively.

The Company considers the near term repayment performance of finance receivables as its primary credit quality indicator. The Company performs credit checks through consumer reporting agencies on certain borrowers. If a third-party lender provides the advance, the applicable third‑party lender decides whether to approve the loan and establishes all of the underwriting criteria and terms, conditions, and features of the customer’s loan agreement.

The aging of receivables at March 31, 2018, and December 31, 2017, were as follows:

	March 31, 2018				December 31, 2017
Current finance receivables	$	81,847	92.0	%	$	101,102	89.2	%
Past due finance receivables (1 - 30 days)
Short-term consumer loans		1,280	1.4	%		2,046	1.8	%
Medium-term consumer loans		2,575	2.9	%		6,502	5.7	%
Total past due finance receivables (1 - 30 days)		3,855	4.3	%		8,548	7.5	%
Past due finance receivables (31 - 60 days)
Medium-term consumer loans		2,588	2.9	%		3,130	2.8	%
Total past due finance receivables (31 - 60 days)		2,588	2.9	%		3,130	2.8	%
Past due finance receivables (61 - 90 days)
Medium-term consumer loans		685	0.8	%		588	0.5	%
Total past due finance receivables (61 - 90 days)		685	0.8	%		588	0.5	%
Total delinquent		7,128	8.0	%		12,266	10.8	%
	$	88,975	100.0	%	$	113,368	100.0	%

Note 3. Related Party Transactions and Balances

There were no new significant related party transactions, or material changes to existing related party transactions, during the three months ended March  31, 2018.

Note 4. Other Intangible Assets

Intangible amortization expense for the three months ended March  31, 2018, and 2017 was $123 and $124, respectively. There were no additional significant changes to other intangible assets during the three months ended March  31, 2018.  

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Note 5. Pledged Assets and Debt

Lines of credit at March 31, 2018 and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$47,000 Revolving credit, secured, interest rate as defined below, due April 2019, collateralized by all Guarantor Company assets	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129
		47,000		4,201		42,799		47,000		1,871		45,129
Less current maturities		—		—		—		—		—		—
Long-term portion	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129

The interest rate is set at three-month LIBOR plus 11%, and there is an exit fee for early termination of the facility. The 3-month LIBOR was 2.31% and 1.69% at March 31, 2018 and December 31, 2017, respectively, and the prime rate was 4.75% and 4.50% at March 31, 2018 and December 31, 2017, respectively.

On March 30, 2018, the Company amended its revolving credit facility with Victory Park Management, LLC, as administrative agent, and certain of its affiliates as lenders, which we refer to collectively as VPC, to extend the maturity date to April 4, 2019. The amendment also waived certain events of default, eliminated the obligation to satisfy a quarterly fixed charge coverage test and added covenants addressing daily minimum liquidity and asset coverage tests, weekly operational reporting requirements and monthly EBITDA and borrowing base coverage tests. Additionally, the Company is required to use commercially reasonable efforts to obtain reasonably satisfactory modification of the 2019 and 2020 Notes.

Senior secured notes payable at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$395,000 Senior Note payable, 10.75 %, collateralized by all  Guarantor Company assets, semi-annual interest payments with principal due May 2019	$	237,290	$	1,222	$	236,068	$	237,290	$	1,504	$	235,786
$25,000 Senior Note payable, 12.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2020		12,500		143		12,357		12,500		160		12,340
		249,790		1,365		248,425		249,790		1,664		248,126
Less current maturities		—		—		—		—		—		—
Long-term portion	$	249,790	$	1,365	$	248,425	$	249,790	$	1,664	$	248,126

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Subsidiary notes payable at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$60,000 Note, secured, 16.75%, collateralized by acquired loans, due April 2019	$	60,000	$	2,191	$	57,809	$	60,000	$	744	$	59,256
$1,425 Term note, secured, 4.25%, collateralized by financed asset, due July 2019		867		4		863		882		5		877
$1,165 Term note, secured, 4.50%, collateralized by financed asset, due May 2021		1,061		13		1,048		1,076		14		1,062
		61,928		2,208		59,720		61,958		763		61,195
Less current maturities		121		1		120		119		1		118
Long-term portion	$	61,807	$	2,207	$	59,600	$	61,839	$	762	$	61,077

On March 30, 2018, the $60,000 Note was further amended to extend the maturity date to April 4, 2019. The amendment increases the administrative fee to 0.95% and permits an additional extension of the facility maturity date to April 2021 if certain conditions are met. The amendment allows for additional short term loans within the borrowing base and includes additional covenants addressing daily minimum cash and asset coverage tests, dividend limits, weekly operational reporting requirements, borrowing base reporting and a monthly consolidated EBITDA test.

Liquidity and Need for Additional Capital

The Company’s cash balance of $89,694 as of March 31, 2018, plus cash from operating activities, is expected to be sufficient to fund the Company’s operations through the first quarter of 2019. However, $237,290 of senior notes, $47,000 of revolving credit facility debt, and $60,000 in subsidiary notes are due in the second quarter of 2019. The Company’s expected cash position will not be sufficient to repay this indebtedness as it becomes due and the Company will need to restructure or refinance this indebtednessand there can be no assurances as to the ability of the Company to conclude such a restructuring or refinancing. These factors raise substantial doubt regarding the Company’s ability to meet its obligations and continue as a going concern for the period which extends one-year from the issuance of these financial statements.

While the Company is currently engaged in negotiations with its largest bondholders, the success of such negotiations cannot be assured.  Any inability to reach an agreement with existing debt holders, secure sufficient refinancing sources for our pending debt maturities and/or our inability to continue as a going concern could have a significant and material adverse effect on the Company, its operations and its investors and, in particular, could significantly impair recoveries by our investors under our existing indebtedness.  It is unlikely that the Company’s assets, in any event, would be sufficient to satisfy its current debt obligations.  See Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017 for more information on how these contingences could negatively impact the Company and its debt holders.

15

Note 6. Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities at March  31, 2018, and December 31, 2017, consisted of the following:

	March 31,		December 31,
	2018		2017
Accounts payable	$	3,477	$	5,465
Accrued payroll and compensated absences		6,316		7,718
Wire transfers payable		1,502		2,238
Accrual for third-party losses		3,768		4,818
Unearned CSO Fees		6,620		8,029
Deferred rent		791		867
Bill payment service liability		2,036		2,604
Lease termination		1,727		1,978
Other		5,566		5,849
	$	31,803	$	39,566

Note 7. Operating and Capital Lease Commitments and Total Rental Expense

Rental expense, including common area maintenance and real estate tax expense, totaled $6,660 and $7,034 for the three months ended March  31, 2018, and 2017, respectively.

The Company closed its Utah facility during the three months ended March 31, 2017, resulting in lease termination expense of $1,762 which is disclosed on the consolidated statement of operations

There were no additional significant changes to operating and capital lease commitments during the three months ended March 31, 2018.

Note 8. Concentrations of Credit Risks

The Company’s portfolio of finance receivables is comprised of loan agreements with customers living in thirty three states and consequently such customers’ ability to honor their contracts may be affected by economic conditions in those states. Additionally, the Company is subject to regulation by federal and state governments that affect the products and services provided by the Company. To the extent that laws and regulations are passed that affect the Company’s ability to offer loans or similar products in any of the states in which it operates, the Company’s financial position could be adversely affected.

The following table summarizes the allocation of the portfolio balance by state at March 31, 2018, and December 31, 2017:

	March 31, 2018				December 31, 2017
	Balance		Percentage of		Balance		Percentage of
State	Outstanding		Total Outstanding		Outstanding		Total Outstanding
Alabama	$	10,001	11.2	%	$	12,808	11.3	%
Arizona		9,935	11.2			11,994	10.6
California		31,290	35.2			39,835	35.1
Mississippi		5,864	6.6			7,409	6.5
Virginia		10,152	11.4			12,018	10.6
Other retail segment states		14,685	16.5			19,696	17.4
Other internet segment states		7,048	7.9			9,608	8.5
Total	$	88,975	100.0	%	$	113,368	100.0	%

The other retail segment states are:  Florida, Indiana, Kentucky, Michigan, Ohio, Oregon, and Tennessee.

16

The other internet segment states are: Alabama, Alaska, California, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Kansas, Louisiana, Maine, Minnesota, Mississippi, Missouri, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming.

The Company offers a CSO product in Ohio and Texas to assist consumers in obtaining credit with unaffiliated third-party lenders. Total gross finance receivables for which the Company has recorded an accrual for third-party lender losses totaled $29,575 and $36,967 at March 31, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off-balance sheet arrangement. The total gross finance receivables consist of $28,646 and $35,801 in short-term and $929 and $1,166 in medium-term loans at March 31, 2018, and December 31, 2017, respectively.

Note 9. Contingencies

From time‑to‑time the Company is a defendant in various lawsuits and administrative proceedings wherein certain amounts are claimed or violations of law or regulations are asserted. In the opinion of the Company’s management, these claims are without substantial merit and should not result in judgments which in the aggregate would have a material adverse effect on the Company’s financial statements.

Note 10. Stock Based Compensation

During the three months ended March 31, 2018, the Company issued 76,559 options with a per share exercise price of $1.00 with the options vesting on specific dates defined in the award agreements.

The following weighted average assumptions were used by the Company for awards granted during the three months ended March 31, 2018:

	2018
Risk‑free interest rate		1.76%
Dividend yield		0.00%
Expected volatility		150.00%
Expected term (years)		1.00
Weighted average fair value of options granted	$	—

Stock-based compensation costs for the three months ended March 31, 2018, and 2017 were $8 and $32, respectively. As of March 31, 2018, and December 31, 2017, unrecognized stock-based compensation costs to be recognized over future periods approximated $58 and $66, respectively. At March 31, 2018, the remaining unrecognized compensation expense was $58 for certain awards that vest over the requisite service period. The remaining compensation expense of $58 is expected to be recognized over a weighted-average period of 1.8 years. The total income tax benefit recognized in the income statement for the stock-based compensation arrangements was $2 and $9 for the three months ended March 31, 2018, and 2017, respectively.

17

Stock option activity for the three months ended March 31, 2018, is as follows (these amounts have not been rounded in thousands):

		Weighted-Average				Aggregate
		ExercisePrice		Weighted-Average		Intrinsic
		(actual per		Remaining		Value
	Shares	share price)		ContractualTerm		(thousands)
Outstanding at December 31, 2017	1,332,632	$	2.25		8.5		N/A
Granted	76,559		1.00		8.3		N/A
Exercised	—		—		—		N/A
Forfeited or expired	—		—		—		N/A
Outstanding at March 31, 2018	1,409,191	$	2.18		8.3		N/A
Exercisable at March 31, 2018	1,277,737	$	2.25		8.2	$	—
Vested or expected to vest at March 31, 2018	1,409,191	$	2.18		8.3	$	—

Note 11. Business Segments

The Company has elected to organize and report on its operations as two operating segments: Retail financial services and Internet financial services.

The following tables present summarized financial information for the Company’s segments:

	As of and for the three months ended March 31, 2018
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	166,505			$	37,511					$	204,016
Other Intangible Assets		336				466						802
Total Revenues	$	72,797	100.0	%	$	14,854	100.0	%			$	87,651	100.0	%
Provision for Loan Losses		15,620	21.4	%		7,015	47.2	%				22,635	25.8	%
Other Operating Expenses		36,291	49.9	%		1,540	10.4	%				37,831	43.2	%
Operating Gross Profit		20,886	28.7	%		6,299	42.4	%				27,185	31.0	%
Interest Expense, net		9,479	13.0	%		2,699	18.2	%				12,178	13.9	%
Depreciation and Amortization		1,000	1.4	%		93	0.6	%				1,093	1.3	%
Other Corporate Expenses (a)		—	—			—	—			17,602		17,602	20.1	%
Income (Loss) from Continuing Operations, before tax		10,407	14.3	%		3,507	23.6	%		(17,602)		(3,688)	(4.2)	%

(a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

18

	As of and for the three months ended March 31, 2017
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	309,595			$	57,106					$	366,701
Goodwill		113,256				—						113,256
Other Intangible Assets		488				800						1,288
Total Revenues	$	68,691	100.0	%	$	16,661	100.0	%			$	85,352	100.0	%
Provision for Loan Losses		12,058	17.6	%		7,482	44.9	%				19,540	22.9	%
Other Operating Expenses		38,207	55.6	%		1,009	6.1	%				39,216	45.9	%
Operating Gross Profit		18,426	26.8	%		8,170	49.0	%				26,596	31.2	%
Interest Expense, net		7,366	10.7	%		4,005	24.0	%				11,371	13.3	%
Depreciation and Amortization		1,129	1.6	%		180	1.1	%				1,309	1.5	%
Lease termination Expenses		—	—	%		1,762	10.6	%				1,762	2.1	%
Other Corporate Expenses (a)		—	—			—	—			20,186		20,186	23.7	%
Income (loss) from Continuing Operations, before tax		9,931	14.5	%		2,223	13.3	%		(20,186)		(8,032)	(9.4)	%

(a)Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

Note 12. Income Taxes

The Company files a consolidated federal income tax return. The Company files consolidated or separate state income tax returns as permitted by the individual states in which it operates. The differences between our effective rate and the U.S. statutory rate is primarily due to non-deductible expenses, state taxes, and changes in valuation allowance. The Company had no liability recorded for unrecognized tax benefits at March  31, 2018, and December 31, 2017.

At March  31, 2018, the Company had gross deferred tax assets of $72,877 and a valuation allowance of $72,877. At December 31, 2017, the Company had gross deferred tax assets of $71,896 and a valuation allowance of $71,896. The Company maintains a full valuation allowance against its deferred tax assets as it is more likely than not that the deferred tax assets will not be realized. In evaluating whether a valuation allowance is needed for the deferred tax assets, the Company considered the ability to carry net operating losses back to prior periods, reversing taxable temporary differences, and estimates of future taxable income. There have been no credits or net operating losses that have expired. The projections were evaluated in light of past operating results and considered the risks associated with generating future taxable income due to macroeconomic conditions in the markets in which the Company operates, regulatory developments and cost containment. The Company will continue to evaluate the need for a valuation allowance against deferred tax assets in future periods and will adjust the allowance as necessary if it determines that it is more likely than not that some or all of the deferred tax assets will be realized.

Note 13. Transactions with Variable Interest Entities

The Company has limited agency agreements with unaffiliated third-party lenders. The agreements govern the terms by which the Company refers customers to that lender, on a non-exclusive basis, for a possible extension of credit, processes loan applications, and commits to reimburse the lender for any loans or related fees that were not collected from such customers. As of March 31, 2018, and December 31, 2017, the outstanding amount of active consumer loans guaranteed by the Company, which represents the Company’s maximum exposure, was $29,575 and $36,967, respectively. The outstanding amount of consumer loans with unaffiliated third-party lenders consist of $28,646 and $35,801 in short-term and $929 and $1,166 in installment loans at March 31, 2018, and December 31, 2017, respectively. The accrual for third party lender losses related to these obligations totaled $3,768 and $4,818 as of March  31, 2018, and December 31, 2017, respectively. This obligation is recorded as a current liability on the Company’s consolidated balance sheet. The Company has determined that the lenders are Variable Interest Entities (“VIEs”) but that the Company is not the primary beneficiary of the VIEs. Therefore, the Company has not consolidated either lender.

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Note 14. Supplemental Guarantor Information

The 2019 notes and the 2020 notes contain various covenants that, subject to certain exceptions defined in the indentures governing the notes (the “Indentures”), limit the Company’s ability to, among other things, engage in certain transactions with affiliates, pay dividends or distributions, redeem or repurchase capital stock, incur or assume liens or additional debt, and consolidate or merge with or into another entity or sell substantially all of its assets. The Company has optional redemption features on the 2019 notes and the 2020 notes prior to their maturity which, depending on the date of the redemption, would require premiums to be paid in addition to all principal and interest due.

The 2019 notes and 2020 notes are guaranteed by all of the Company’s guarantor subsidiaries existing as of April 29, 2011 (the date the Company issued the 2019 notes) and any subsequent guarantor subsidiaries that guarantee the Company’s indebtedness or the indebtedness of any other subsidiary guarantor (the “Subsidiary Guarantors”), in accordance with the Indentures. The Company is a holding company and has no independent assets or operations of its own. The guarantees under the 2019 notes and 2020 notes are full, unconditional, and joint and several. There are no restrictions on the ability of the Company or any of the Subsidiary Guarantors to obtain funds from its restricted subsidiaries by dividend or loan, except for net worth requirements of certain states in which the Company operates. Certain Subsidiary Guarantors are required to maintain net worth ranging from $10 to $2,000. The total net worth requirements of these Subsidiary Guarantors is $4,610. The Indentures contain certain affirmative and negative covenants applicable to the Company and its Subsidiary Guarantors, including restrictions on their ability to incur additional indebtedness, consummate certain asset sales, make investments in certain entities that create liens on their assets, enter into certain affiliate transactions and make certain restricted payments, including restrictions on the Company’s ability to pay dividends on, or repurchase, its common stock.

Note 15. Supplemental Condensed Consolidating Guarantor and Non‑Guarantor Financial Information

The following presents the condensed consolidating guarantor financial information as of March 31, 2018, and December 31, 2017, and for the three months ended March 31, 2018, and 2017, for the subsidiaries of the Company that serve as guarantors of the 2019 notes and the 2020 notes, and for the subsidiaries that do not serve as a guarantor. As of March 31, 2018, the non-guarantor subsidiaries are CCFI Funding LLC and CCFI Funding II LLC. During or prior to the first quarter of 2017, the following non-guarantor subsidiaries were dissolved; Direct Financial Solutions of UK Limited and its subsidiary Cash Central UK Limited, Direct Financial Solutions of Canada, Inc and its subsidiaries DFS-CC Financial Services LLC, DFS-CC Financial Services (Calgary) LLC and DFS-CC Financial Services (Toronto) LLC,

and Direct Financial Solutions of Australia Pty Ltd and its subsidiary Cash Central of Australia Pty Ltd. The UK,

Canada, and Australia entities, and their subsidiaries. The Florida II non-guarantor subsidiary was sold on February 1,

2016. Each of the Company’s guarantor subsidiaries are 100% owned by the Company or its subsidiaries, and all guarantees are full, unconditional, and joint and several. 

Of the entities under “Non-Guarantor Subsidiaries” in the tables below, Florida II, CCFI Funding, and CCFI Funding II are “Unrestricted Subsidiaries” as defined in the Indentures. Buckeye Check Cashing of Florida II, LLC was acquired on July 31, 2012, and was sold on February 1, 2016, CCFI Funding was created on December 20, 2013, and CCFI Funding II was established on September 19, 2014. Refer to the “Non-Guarantor Subsidiaries” columns in the following condensed consolidating schedules. The remainder of the entities included under “Non-Guarantor Subsidiaries” in the tables below are “Restricted Subsidiaries” as defined in the Indentures governing the 2019 notes and the 2020 notes and, for the periods specified, did not have material assets, liabilities, revenue or expenses.

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Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets (unaudited)

March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	63,751	$	21,523	$	—	$	85,274
Restricted cash		—		4,420		—		—		4,420
Finance receivables, net		—		20,859		47,427		—		68,286
Card related pre-funding and receivables		—		841		—		—		841
Other current assets		—		22,161		9,655		(18,294)		13,522
Total current assets		—		112,032		78,605		(18,294)		172,343
Noncurrent Assets
Investment in Subsidiaries		365,365		—		—		(365,365)		—
Finance receivables, net		—		3,626		—		—		3,626
Property, leasehold improvements and equipment, net		—		24,816		—		—		24,816
Other intangible assets		—		802		—		—		802
Security deposits		—		2,429		—		—		2,429
Total assets	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	25,761	$	14,251	$	(8,209)	$	31,803
Money orders payable		—		8,024		—		—		8,024
Accrued interest		11,937		5		4,232		(4,232)		11,942
Current portion of capital lease obligation		—		160		—		—		160
Current portion of subsidiary note payable		—		120		—		—		120
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		11,937		36,605		24,336		(18,294)		54,584
Noncurrent Liabilities
Lease termination payable		—		569		—		—		569
Lines of credit		42,799		—		—		—		42,799
Subsidiary note payable		—		1,791		57,809		—		59,600
Senior secured notes		248,425		—		—		—		248,425
Deferred revenue		—		6,887		—		—		6,887
Total liabilities		303,161		45,852		82,145		(18,294)		412,864
Stockholders' Equity (Deficit)		62,204		97,853		(3,540)		(365,365)		(208,848)
Total liabilities and stockholders' equity	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016

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Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	57,526	$	9,101	$	—	$	66,627
Restricted cash		—		4,585		—		—		4,585
Finance receivables, net		—		47,221		42,486		—		89,707
Card related pre-funding and receivables		—		1,062		—		—		1,062
Other current assets		—		39,604		17,951		(42,284)		15,271
Total current assets		—		149,998		69,538		(42,284)		177,252
Noncurrent Assets
Investment in Subsidiaries		360,599		—		—		(360,599)		—
Finance receivables, net		—		4,632		—		—		4,632
Property, leasehold improvements and equipment, net		—		26,848		—		—		26,848
Other intangible assets		—		924		—		—		924
Security deposits		—		2,750		—		—		2,750
Total assets	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	57,696	$	14,364	$	(32,494)	$	39,566
Money orders payable		—		7,169		—		—		7,169
Accrued interest		5,140		5		3,937		(3,937)		5,145
Current portion of capital lease obligation		—		371		—		—		371
Current portion of subsidiary note payable		—		118		—		—		118
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		5,140		67,894		24,154		(42,284)		54,904
Noncurrent Liabilities
Lease termination payable		—		818		—		—		818
Lines of credit		45,129		—		—		—		45,129
Subsidiary note payable		—		1,821		59,256		—		61,077
Senior secured notes		248,126		—		—		—		248,126
Deferred Revenue		—		7,520		—		—		7,520
Total liabilities		298,395		78,053		83,410		(42,284)		417,574
Stockholders' Equity (Deficit)		62,204		107,099		(13,872)		(360,599)		(205,168)
Total liabilities and stockholders' equity	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406

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Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	22,863	$	28,069	$	—	$	50,932
Credit service fees		—		19,196		—		—		19,196
Check cashing fees		—		11,692		—		—		11,692
Card fees		—		1,948		—		—		1,948
Other		—		3,885		293		(295)		3,883
Total revenues		—		59,584		28,362		(295)		87,651
Operating expenses:
Salaries		—		17,132		—		—		17,132
Provision for loan losses		—		9,205		13,430		—		22,635
Occupancy		—		6,343		—		—		6,343
Advertising and marketing		—		1,011		—		—		1,011
Lease termination costs		—		97		—		—		97
Depreciation and amortization		—		2,223		—		—		2,223
Other		—		11,025		—		—		11,025
Total operating expenses		—		47,036		13,430		—		60,466
Operating gross profit		—		12,548		14,932		(295)		27,185
Corporate expenses		—		17,490		112		—		17,602
Intercompany management fee		—		(1,385)		1,385		—		—
Depreciation and amortization		—		1,093		—		—		1,093
Interest expense, net		9,367		124		2,982		(295)		12,178
Interest expense allocation		(9,367)		9,367		—		—		—
Total corporate and other expenses		—		26,689		4,479		(295)		30,873
Income (loss) before income taxes		—		(14,141)		10,453		—		(3,688)
Provision for income taxes		—		—		—		—		—
Net income (loss)	$	—	$	(14,141)	$	10,453	$	—	$	(3,688)

23

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	39,830	$	9,221	$	—	$	49,051
Credit service fees		—		18,139		—		—		18,139
Check cashing fees		—		12,126		—		—		12,126
Card fees		—		2,007		—		—		2,007
Dividend		—		3,000		—		(3,000)		—
Other		—		4,275		49		(295)		4,029
Total revenues		—		79,377		9,270		(3,295)		85,352
Operating expenses:
Salaries		—		17,273		—		—		17,273
Provision for loan losses		—		16,458		3,082		—		19,540
Occupancy		—		6,629		—		—		6,629
Advertising and marketing		—		814		—		—		814
Lease termination costs		—		47		—		—		47
Depreciation and amortization		—		2,538		—		—		2,538
Other		—		11,914		1		—		11,915
Total operating expenses		—		55,673		3,083		—		58,756
Operating gross profit		—		23,704		6,187		(3,295)		26,596
Corporate expenses		—		20,095		91		—		20,186
Intercompany management fee		—		(427)		427		—		—
Lease termination		—		1,762		—		—		1,762
Depreciation and amortization		—		1,309		—		—		1,309
Interest expense, net		9,023		195		2,448		(295)		11,371
Interest expense allocation		(9,023)		9,023		—		—		—
Total corporate and other expenses		—		31,957		2,966		(295)		34,628
Income (loss) before income taxes		—		(8,253)		3,221		(3,000)		(8,032)
Provision for (benefit from) income taxes		—		342		(134)		125		333
Net income (loss)	$	—	$	(8,595)	$	3,355	$	(3,125)	$	(8,365)

24

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by (used in) operating activities	$	2,762	$	(10,588)	$	32,415	$	24,589
Cash flows from investing activities
Net receivables repaid (originated)		—		18,163		(18,371)		(208)
Purchase of leasehold improvements and equipment		—		(1,274)		—		(1,274)
Net cash provided by (used in) investing activities		—		16,889		(18,371)		(1,482)
Cash flows from financing activities
Payments on subsidiary note		—		(30)		—		(30)
Payments on capital lease obligations		—		(211)		—		(211)
Debt issuance costs		(2,762)		—		(1,622)		(4,384)
Net cash used in financing activities		(2,762)		(241)		(1,622)		(4,625)
Net increase in cash and cash equivalents and restricted cash		—		6,060		12,422		18,482
Cash and cash equivalents and restricted cash:
Beginning		—		62,111		9,101		71,212
Ending	$	—	$	68,171	$	21,523	$	89,694

25

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by operating activities	$	—	$	16,121	$	6,079	$	22,200
Cash flows from investing activities
Net receivables repaid (originated)		—		(5,830)		3,109		(2,721)
Purchase of leasehold improvements and equipment		—		(1,001)		—		(1,001)
Net cash provided by (used in) investing activities		—		(6,831)		3,109		(3,722)
Cash flows from financing activities
Payments on subsidiary note		—		(29)		—		(29)
Payments on capital lease obligations, net		—		(248)		—		(248)
Payments on lines of credit		—		(2,250)		—		(2,250)
Net cash used in financing activities		—		(2,527)		—		(2,527)
Net increase in cash and cash equivalents and restricted cash		—		6,763		9,188		15,951
Cash and cash equivalents and restricted cash:
Beginning		—		74,792		34,556		109,348
Ending	$	—	$	81,555	$	43,744	$	125,299

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion contains management’s discussion and analysis of Community Choice Financial Inc’s financial condition and results of operations. References to “CCFI,” “the company,” “us,” “we,” “our,” and ours” refer to Community Choice Financial Inc, together with its subsidiaries. This discussion contains forward-looking statements and involves numerous risks and uncertainties. Actual results may differ materially from those contained in any forward-looking statements.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 (“Act”) provides a safe harbor for forward-looking statements. Certain statements in this report are forward-looking statements within the meaning of the Act, and such statements are intended to qualify for the protection of the safe harbor provided by the Act. The words “anticipate,” “estimate,” “expect,” “objective,” “goal,” “project,” “intend,” “plan,” “believe,” “will,” “should,” “may,” “target,” “forecast,” “guidance,” “outlook,” and similar expressions generally identify forward-looking statements. Similarly, descriptions of our objectives, strategies, plans, goals or targets are also forward-looking statements. Forward-looking statements relate to the expectations of management as to future occurrences and trends, including statements expressing optimism or pessimism about future operating results or events and projected revenues, earnings, capital expenditures and business strategy. Forward-looking statements are based upon a number of assumptions concerning future conditions that may ultimately prove to be inaccurate. Forward-looking statements are and will be based upon management’s then current views and assumptions regarding future events and operating performance, and are applicable only as of the dates of such statements. Although we believe the expectations expressed in forward-looking statements are based on reasonable assumptions within the bounds of our knowledge, forward-looking statements, by their nature, involve risks, uncertainties and other factors, any one or a combination of which could materially affect our business, financial condition, results of operations or liquidity.

Forward-looking statements that we make herein and in other reports and releases are not guarantees of future performance and actual results may differ materially from those discussed in such forward-looking statements as a result of various factors, including, but not limited to, the ongoing impact of the economic and credit crisis, leveling demand for our products, our inability to successfully execute strategic initiatives, our ability to recognize the expected benefits from recently undertaken strategic initiatives, including those described under “Factors Affecting Our Results of Operations— Strategic Initiatives,” integration of acquired businesses, competitive pressures, economic pressures on our customers and us, regulatory and legislative changes, the impact of legislation, the risks discussed under Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017, and other factors discussed from time to time. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to publicly update forward-looking statements whether as a result of new information, future events or otherwise.

Readers are advised, however, to consult any further disclosures we make on related subjects in our public announcements, releases, and reports.

Overview

We are a leading provider of alternative financial services to unbanked and under-banked consumers. We provide our customers a variety of financial products and services, including short-term and medium-term consumer loans, check cashing, prepaid debit cards, and other services that address the specific needs of our customers. Through our retail focused business model, we provide our customers immediate access to high quality financial services at competitive rates through the channel most convenient for them. As of March  31, 2018, we operated 484 retail locations across 12 states and were licensed to deliver similar financial services over the internet in 30 states.

Our retail business model provides a broad array of financial products and services whether through a retail location or over the internet, whichever distribution channel satisfies the target customer’s needs or desires. We want to achieve a superior level of customer satisfaction, resulting in increased market penetration and value creation. An

27

important part of our retail model is investing in and creating a premier brand presence, supported by a well-trained and motivated workforce with the aim of enhancing the customer’s experience, generating increased traffic and introducing our customers to our diversified set of products.

Factors Affecting Our Results of Operations

Closure of Utah Facility

In February 2017, the Company closed the Utah office that was acquired in 2012 when we purchased Direct Financial Solutions, our internet business. All call center operations were fully integrated into the Company’s primary headquarters in Dublin, Ohio at that time. During the three months ended March  31, 2017, the Company incurred $2.6 million in closure costs consisting of $1.8 million in lease termination expenses and $0.8 million in loss on disposal of assets associated with this consolidation.

Retail Platform

During the three months ended March  31, 2018, the Company closed five retail locations.

The chart below sets forth certain information regarding our retail presence and number of states served via the internet as of and for the year ended December 31, 2017, and the three months ended March  31, 2018.

		Three Months
	Year Ended	Ended
	December 31,	March 31,
	2017	2018
# of Locations
Beginning of Period	518	489
Opened (a)	47	—
Closed	76	5
End of Period	489	484
Number of states licensed for our internet operations	30	30
(a) Includes leases assumed from an unrelated Mississippi entity that terminated its business operations in June 2017.

The following table provides the geographic composition of our physical locations as of December 31, 2017, and March 31, 2018:

	December 31,	March 31,
	2017	2018
Alabama	39	39
Arizona	31	31
California	160	157
Florida	15	15
Indiana	21	21
Kentucky	15	15
Michigan	14	14
Mississippi	51	50
Ohio	91	91
Oregon	2	2
Tennessee	24	23
Virginia	26	26
	489	484

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In addition, the Company is licensed to provide internet financial services in the following states: Alabama, Alaska, California, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Kansas, Louisiana, Maine, Minnesota, Mississippi, Missouri, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina,  Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming.

Changes in Legislation & Regulation 

As previously disclosed in the Company’s Annual Report on Form 10-K, the CFPB Rule remains subject to potential override by congressional disapproval pursuant to the Congressional Review Act and a resolution to override the CFPB Rule was filed in the United States Senate on March 23, 2018, and remains pending. Further, the CFPB Rule is being challenged in a lawsuit filed by the Community Financial Services Association of America and Consumer Service Alliance of Texas on April 9, 2018, filed in the U.S. District Court for the Western District of Texas, Austin Division.  It is possible that the CFPB Rule will also be subject to legal challenge by other trade groups or other private parties.

On April 18, 2018, Ohio House Bill 123 (“HB 123”), passed out of the House of Representative’s Government Accountability and Oversight Committee.  It has not yet, however, come before the full house for a vote.  HB 123 amends the General Loan Law and Small Loan Law, under which one of the Company’s Ohio’s subsidiaries is licensed, to prohibit loans with a term of fewer than 180-days.  HB 123 also prohibits credit services organizations, such as the Company’s CSO subsidiary currently operating in Ohio, from brokering an extension of credit if that credit is in a principal amount of less than $5,000.00, with a term fewer than 180-days, and that has an annual percentage rate greater than 28%.  Whether HB 123 will ultimately pass both the House of Representatives and the Senate is unknown.

Product Characteristics and Mix

As the Company expands its product offerings to meet customers’ needs, the characteristics of our overall loan portfolio shift to reflect the terms of these new products. Our various lending products have different terms. Our prepaid debit card direct deposit offering may reduce our check cashing fees, however, the availability of direct deposit to the Insight prepaid card as an alternative to check cashing may extend the customer relationship.

Expenses

Our operating expenses relate primarily to the operation of our retail locations and internet presence, including salaries and benefits, retail location occupancy costs, call center costs, advertising, loan loss provisions, and depreciation of assets. We also incur corporate and other expenses on a company-wide basis, including interest expense and other financing costs related to our indebtedness, insurance, salaries, benefits, occupancy costs, professional expenses and management fees paid to our majority stockholders.

We view our compliance, collections and operations groups as core competencies. We have invested in each of these areas and believe we will benefit from increased economies of scale and satisfy the increased regulatory scrutiny of the CFPB.

Critical Accounting Policies

Consistent with accounting principles generally accepted in the United States of America, our management makes certain estimates and assumptions to determine the reported amounts of assets, liabilities, revenue and expenses in the process of preparing our financial statements. These estimates and assumptions  are based on the best information available to management at the time the estimates or assumptions are made. The most significant estimates made by our management include allowance for loan losses, stock based compensation, and our determination for recording the amount of deferred income tax assets and liabilities, because these estimates and assumptions could change materially as a result of conditions both within and beyond management’s control.

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Management believes that among our significant accounting policies, the following involve a higher degree of judgment:

Finance Receivables, Net

Finance receivables consist of short-term and medium-term consumer loans.

Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term products typically range in size from $100 to $1,000, with a maturity between fourteen and thirty days, and an agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations which vary by state. Statutes vary from state-to-state permitting charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advances by making cash payments or allowing the check or preauthorized debit to be presented. Secured short-term products typically range from $750 to $5,000, and are asset-based consumer loans whereby the customer obtains cash and grants a security interest in the collateral that may become a lien against that collateral. Secured consumer loans represented 14.5% and 14.0% of short-term consumer loans at December 31, 2017, and March  31, 2018, respectively.

Medium-term consumer loans can be unsecured or secured with a maturity of three months up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000. These consumer loans vary in structure depending upon the regulatory environment where they are offered. The consumer loans are due in installments or provide for a line of credit with periodic monthly payments. Secured medium-term products typically range from $750 to $5,000, and are asset-based consumer loans whereby the customer obtains cash and grants a security interest in the collateral that may become a lien against that collateral. Secured consumer loans represented 12.6% and 14.0% of medium-term consumer loans at December 31, 2017, and March  31, 2018, respectively.

In some instances, the Company maintains debt-purchasing arrangements with third-party lenders. The Company accrues for these obligations through management’s estimation of anticipated purchases based on expected losses in the third-party lender’s portfolio. This obligation is recorded as a current liability on our balance sheet.

Total finance receivables, net of unearned advance fees and allowance for loan losses on the consolidated balance sheet as of December 31, 2017, and March  31, 2018, were $94.3 million and $71.9 million, respectively. The allowance for loan losses as of December 31, 2017, and March  31, 2018, were $16.3 million and $14.8 million, respectively. At December 31, 2017, and March  31, 2018, the allowance for loan losses was 14.8% and 17.1%, respectively, of total finance receivables, net of unearned advance fees.

Finance receivables, net as of December 31, 2017, and March  31, 2018, are as follows (in thousands):

	December 31,		March 31,
	2017		2018
Finance Receivables, net of unearned advance fees	$	110,666	$	86,715
Less: Allowance for loan losses		16,327		14,803
Finance Receivables, Net	$	94,339	$	71,912

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The total changes to the allowance for loan losses for the three months ended March  31, 2017 and 2018, were as follows (in thousands):

	Three Months Ended
	March 31,
	2017		2018
Allowance for loan losses
Beginning of Period	$	16,219	$	16,327
Provisions for loan losses		13,654		16,556
Charge-offs, net		(16,864)		(18,080)
End of Period	$	13,009	$	14,803
Allowance as a percentage of finance receivables, net of unearned advance fees		14.4%		17.1%

The provision for loan losses for the three months ended March 31, 2017, and 2018 includes losses from returned items from check cashing of $1.4 million and $1.1 million, respectively, and third party lender losses of $4.5 million and $5.0 million, respectively.

In some instances the Company guarantees loans with third-party lenders. As of December 31, 2017, and March 31, 2018, the outstanding amount of active consumer loans were $37.0 million and $29.6 million, respectively, consisting of $35.8 million and $28.6 million in short-term, and $1.2 million and $1.0 million in installment loans, respectively. The Company accrues for these obligations through management’s estimation of anticipated purchases based on expected losses in the third-party lender’s portfolio. This obligation is recorded as a current liability on our balance sheet and was $4.8 million and $3.8 million as of December 31, 2017, and March 31, 2018, respectively.

Income Taxes 

We record income taxes as applicable under generally accepted accounting standards. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is recorded to reduce the deferred tax asset if it is more likely than not that some portion of the asset will not be realized.

As of December 31, 2017, the Company had a valuation allowance on its deferred tax assets as it was more likely than not that approximately $71.9 million of net deferred tax assets would not be realized in the foreseeable future. Based on a  pre-tax loss of $3.7 million for the three months ended March 31, 2018, and the projected reversal of temporary items, the Company continues to maintain a full valuation allowance against its deferred tax assets.

Non-Guarantor Subsidiaries and Unrestricted Subsidiaries

As described in more detail under Note 15 to the consolidated financial statements, we had two non-guarantor subsidiaries as of March 31, 2018. Certain information with respect to our Non-guarantor Subsidiaries is set out in the table below.

	Three Months Ended
	March 31,
	2017		2018
Statement of Operations Data:
Total revenues	$	9,270	$	28,362
Total operating expenses		3,083		13,430
Income before income taxes		3,221		10,453
Balance Sheet Data:
Total assets	$	56,029	$	78,605
Total liabilities		55,897		82,145

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As of March 31, 2018, of the entities classified as “Non-Guarantor Subsidiaries,” CCFI Funding, and CCFI  Funding II are “Unrestricted Subsidiaries” as defined in the indentures governing our senior notes. CCFI Funding was created on December 20, 2013, and CCFI Funding II was established on September 19, 2014. The remainder of the entities included under “Non-Guarantor Subsidiaries” are “Restricted Subsidiaries” as defined in the indentures governing our senior secured notes and do not have material assets, liabilities, revenue or expenses.

Results of Operations

Three Months Ended March  31, 2018, Compared to the Three Months Ended March  31, 2017

The following table sets forth key operating data for the three months ended March 31, 2017, and 2018 (dollars in thousands):

	Three Months Ended March 31,
	2017		2018		Increase (Decrease)				2017	2018
							(Percent)		(Percent of Revenue)
Total Revenues	$	85,352	$	87,651	$	2,299		2.7%	100.0%	100.0%
Operating Expenses
Salaries		17,273		17,132		(141)		(0.8%)	20.1%	19.5%
Provision for losses		19,540		22,635		3,095		15.8%	22.9%	25.8%
Occupancy		6,629		6,343		(286)		(4.3%)	7.7%	7.2%
Advertising and marketing		814		1,011		197		24.2%	1.0%	1.2%
Lease termination		47		97		50		106.4%	0.1%	0.1%
Depreciation and amortization		2,538		2,223		(315)		(12.4%)	3.0%	2.5%
Other operating expenses		11,915		11,025		(890)		(7.5%)	14.0%	12.6%
Total Operating Expenses		58,756		60,466		1,710		2.9%	68.8%	69.0%
Income from Operations		26,596		27,185		589		2.2%	31.2%	31.0%
Corporate and other expenses
Corporate expenses		20,024		17,452		(2,572)		(12.8%)	23.5%	19.9%
Lease termination		1,762		—		(1,762)		(100.0%)	2.1%	—
Depreciation and amortization		1,309		1,093		(216)		(16.5%)	1.6%	1.1%
Interest expense, net		11,371		12,178		807		7.1%	13.3%	13.9%
Income tax expense		333		—		(333)		(100.0%)	0.3%	0.0%
Total corporate and other expenses		34,799		30,723		(4,076)		(11.7%)	40.8%	35.1%
Net loss before advisory fee		(8,203)		(3,538)		4,665		(56.9%)	(9.6%)	(4.0%)
Sponsor advisory fee		162		150		(12)		(7.4%)	0.2%	0.2%
Net loss	$	(8,365)	$	(3,688)	$	4,677		(55.9%)	(9.8%)	(4.2%)

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Operating Metrics

The following tables set forth key loan and check cashing operating data as of and for the three months ended March  31, 2017, and 2018:

	Three Months Ended March 31,
	2017		2018
Short-term Loan Operating Data (unaudited):
Loan volume (originations and refinancing) (in thousands)	$	235,263	$	258,217
Number of loan transactions (in thousands)		632		707
Average new loan size	$	372	$	365
Average fee per new loan	$	49.16	$	48.49
Loan loss provision	$	6,433	$	8,159
Loan loss provision as a percentage of loan volume		2.7%		3.2%
Secured loans as percentage of total at March 31st		17.4%		14.0%
Medium-term Loan Operating Data (unaudited):
Balance outstanding (in thousands)	$	41,185	$	36,860
Number of loans outstanding		36,819		34,486
Average balance outstanding	$	1,119	$	1,069
Weighted average monthly percentage rate		16.5%		16.6%
Allowance as a percentage of finance receivables		27.1%		33.9%
Loan loss provision	$	7,221	$	8,397
Secured loans as percentage of total at March 31st		10.1%		14.0%
Check Cashing Data (unaudited):
Face amount of checks cashed (in thousands)	$	465,856	$	454,573
Number of checks cashed (in thousands)		815		750
Face amount of average check	$	572	$	606
Average fee per check	$	14.88	$	15.59
Returned check expense	$	1,399	$	1,062
Returned check expense as a percent of face amount of checks cashed		0.3%		0.2%

Revenue

	Three Months Ended March 31,
	2017		2018		Decrease			2017	2018
							(Percent)	(Percent of Revenue)
Short-term Consumer Loan Fees and Interest	$	31,058	$	34,265	$	3,207	10.3%	36.4%	39.1%
Medium-term Consumer Loan Fees and Interest		17,993		16,667		(1,326)	(7.4%)	21.1%	19.0%
Credit Service Fees		18,139		19,196		1,057	5.8%	21.3%	21.9%
Check Cashing Fees		12,126		11,692		(434)	(3.6%)	14.2%	13.3%
Prepaid Debit Card Services		2,007		1,948		(59)	(2.9%)	2.4%	2.2%
Other Income		4,029		3,883		(146)	(3.6%)	4.6%	4.5%
Total Revenue	$	85,352	$	87,651	$	2,299	2.7%	100.0%	100.0%

Total revenue for the three months ended March 31, 2018, increased $2.3 million, or 2.7%, as compared to the same period in the prior year.  The increases in short-term consumer loan fees and credit service fees are in-line with the Company’s continuing strategy of growing its portfolios and increasing revenue.

Revenue from short-term consumer loan fees and interest for the three months ended March  31, 2018,  increased $3.2 million, or 10.3%, and increased as a percentage of total revenue from 36.4% to 39.1% compared to the same period in 2017.  The increase in short-term consumer loan revenue is primarily due to the Company’s focus on growing its short-term consumer loan portfolios.

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Revenue from medium-term consumer loans for the three months ended March  31, 2018, decreased $1.3 million, or 7.4%, compared to the same period in 2017. However, medium-term consumer loan revenue for the Retail financial services segment increased by $1.3 million, or 15.1%, for the three months ended March 31, 2018 as compared to the prior year period. 

Revenue from credit service fees for the three months ended March  31, 2018,  increased $1.1 million, or 5.8%, compared to the same period in 2017, primarily the result of the Company growing its CSO portfolios in certain markets.

Operating Expenses

	Three Months Ended March 31,
	2017		2018		Increase (Decrease)			2017	2018
							(Percent)	(Percent of Revenue)
Salaries	$	17,273	$	17,132	$	(141)	(0.8%)	20.1%	19.5%
Provision for Loan Losses		19,540		22,635		3,095	15.8%	22.9%	25.8%
Occupancy		6,629		6,343		(286)	(4.3%)	7.7%	7.2%
Depreciation & Amortization		2,538		2,223		(315)	(12.4%)	3.0%	2.5%
Lease Termination Costs		47		97		50	106.4%	0.1%	0.1%
Advertising & Marketing		814		1,011		197	24.2%	1.0%	1.2%
Bank Charges		1,863		1,847		(16)	(0.9%)	2.2%	2.1%
Store Supplies		483		394		(89)	(18.4%)	0.6%	0.4%
Collection Expenses		509		633		124	24.4%	0.6%	0.7%
Telecommunications		2,251		1,384		(867)	(38.5%)	2.6%	1.6%
Security		436		645		209	47.9%	0.5%	0.7%
License & Other Taxes		361		360		(1)	(0.3%)	0.4%	0.4%
Loss on Asset Disposal		113		111		(2)	(1.8%)	0.1%	0.1%
Verification Processes		567		965		398	70.2%	0.7%	1.1%
Other Operating Expenses		5,332		4,686		(646)	(12.1%)	6.2%	5.3%
Total Operating Expenses		58,756		60,466		1,710	2.9%	68.8%	69.0%
Income from Operations	$	26,596	$	27,185	$	589	2.2%	31.2%	31.0%

Total operating expenses increased $1.7 million, or 2.9%, for the three months ended March  31, 2018, as compared to the same period in the prior year, primarily due to the increased provision related to growing loan portfolios, partially offset by the decrease in telecommunications and other operating expenses.

Salaries and occupancy expenses both decreased for the three months ended March 31, 2018, as compared to the prior period, primarily due to the consolidation of underperforming retail locations.

The provision for loan losses increased $3.1 million, or 15.8%, for the three months ended March  31, 2018, as compared to the same period in the prior year primarily related to growing loan portfolios in the Retail financial services segment. On the other hand, the provision for loan losses as a percentage of revenue for the current quarter was less than the comparable percentages for each of the preceding two fiscal quarters, for both short-term and medium-term consumer loans.

Telecommunications costs decreased by $0.9 million, or 38.5%, for the three months ended March  31, 2018, as compared to the prior period, primarily by implementing less expensive service providers.

Other operating expenses decreased by $0.6 million, or 12.1%, for the three months ended March  31, 2018, as compared to the prior period, primarily as a result of our cost containment initiatives.

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Corporate and Other Expenses

	Three Months Ended March 31,
	2017		2018		Increase (Decrease)			2017	2018
							(Percent)	(Percent of Revenue)
Corporate Expenses	$	20,024	$	17,452	$	(2,572)	(12.8%)	23.5%	19.9%
Depreciation & Amortization		1,309		1,093		(216)	(16.5%)	1.6%	1.2%
Sponsor Advisory Fee		162		150		(12)	(7.4%)	0.2%	0.2%
Interest expense, net		11,371		12,178		807	7.1%	13.3%	13.9%
Lease termination		1,762		—		(1,762)	(100.0%)	2.1%	—
Income tax expense (benefit)		333		—		(333)	(100.0%)	0.3%	—
Total Corporate and Other Expenses	$	34,961	$	30,873	$	(4,088)	(11.7%)	41.0%	35.2%

The decrease in corporate expenses from $20.0 million to $17.5 million, for the three months ended March 31, 2018, as compared to the prior year’s period, or a decrease of 12.8%, is primarily the result of compensation and headcount reductions.

Lease termination in the prior period is the result of closing the Company’s Utah facility.

There is no income tax expense in the current period due to the current net loss and the full impairment of goodwill taken in the fourth quarter of 2017.

Business Segment Results of Operations for the Three Months Ended March  31, 2018, and March 31, 2017

The following tables present summarized financial information for our segments:

	As of and for the three months ended March 31, 2018
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	166,505			$	37,511					$	204,016
Other Intangible Assets		336				466						802
Total Revenues	$	72,797	100.0	%	$	14,854	100.0	%			$	87,651	100.0	%
Provision for Loan Losses		15,620	21.4	%		7,015	47.2	%				22,635	25.8	%
Other Operating Expenses		36,291	49.9	%		1,540	10.4	%				37,831	43.2	%
Operating Gross Profit		20,886	28.7	%		6,299	42.4	%				27,185	31.0	%
Interest Expense, net		9,479	13.0	%		2,699	18.2	%				12,178	13.9	%
Depreciation and Amortization		1,000	1.4	%		93	0.6	%				1,093	1.3	%
Other Corporate Expenses (a)		—	—			—	—			17,602		17,602	20.1	%
Income (Loss) from Continuing Operations, before tax		10,407	14.3	%		3,507	23.6	%		(17,602)		(3,688)	(4.2)	%

(a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

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	As of and for the three months ended March 31, 2017
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	309,595			$	57,106					$	366,701
Goodwill		113,256				—						113,256
Other Intangible Assets		488				800						1,288
Total Revenues	$	68,691	100.0	%	$	16,661	100.0	%			$	85,352	100.0	%
Provision for Loan Losses		12,058	17.6	%		7,482	44.9	%				19,540	22.9	%
Other Operating Expenses		38,207	55.6	%		1,009	6.1	%				39,216	45.9	%
Operating Gross Profit		18,426	26.8	%		8,170	49.0	%				26,596	31.2	%
Interest Expense, net		7,366	10.7	%		4,005	24.0	%				11,371	13.3	%
Depreciation and Amortization		1,129	1.6	%		180	1.1	%				1,309	1.5	%
Lease termination Expenses		—	—	%		1,762	10.6	%				1,762	2.1	%
Other Corporate Expenses (a)		—	—			—	—			20,186		20,186	23.7	%
Income (loss) from Continuing Operations, before tax		9,931	14.5	%		2,223	13.3	%		(20,186)		(8,032)	(9.4)	%

(a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose all other corporate expenses as unallocated.

Retail Financial Services

Retail financial services represented 83.1%, or $72.8 million, of consolidated revenues for the three months ended March  31, 2018, which was an increase of $4.1 million, or 6.0%, over the prior period. Retail financial services operating gross profit as a percentage of revenue increased to 28.7% from 26.8% for the three months ended March 31, 2018 as compared to the prior period.

Internet Financial Services

For the three months ended March  31, 2018, total revenues contributed by our Internet financial services segment was $14.9 million, a decrease of $1.8 million, or 10.8%, over the prior year comparable period due to medium-term portfolios decreasing throughout the prior year.  

Liquidity and Need for Additional Capital

We have historically funded our liquidity needs through cash flow from operations and borrowings under our revolving credit facilities and subsidiary notes. The Company’s cash balance of $89.7 million as of March 31, 2018, plus cash from operating activities, is expected to be sufficient to fund the Company’s operations through the first quarter of 2019. However, $237.3 million of senior notes, $47.0 million of revolving credit facility debt, and $60.0 million in subsidiary notes are due in the second quarter of 2019. The Company’s expected cash position will not be sufficient to repay this indebtedness as it becomes due and the Company will need to restructure or refinance this indebtedness and there can be no assurances as to the ability of the Company to conclude such a restructuring or refinancing. These factors raise substantial doubt regarding the Company’s ability to meet its obligations and continue as a going concern for the period which extends one-year from the issuance of these financial statements. Beyond that twelve-month period, funding capital expenditures, working capital and debt requirements will depend on our future financial performance, which is subject to many economic, commercial, regulatory, financial and other factors that are beyond our control.

While the Company is currently engaged in negotiations with its largest bondholders, the success of such negotiations cannot be assured.  Any inability to reach an agreement with existing debt holders, secure sufficient refinancing sources for our pending debt maturities and/or our inability to continue as a going concern could have a significant and material adverse effect on the Company, its operations and its investors and, in particular, could significantly impair recoveries by our investors under our existing indebtedness.  It is unlikely that the Company’s assets, in any event, would be sufficient to satisfy its current debt obligations.  See Item 1A “Risk Factors” in our Annual

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Report on Form 10-K for the year ended December 31, 2017 for more information on how these contingences could negatively impact the Company and its debt holders.

Three Month Cash Flow Analysis

The table below summarizes our cash flows for the three months ended March  31, 2017, and 2018.

	Three Months Ending March 31,
(in thousands)	2017		2018
Net Cash Provided by Operating Activities	$	22,200	$	24,589
Net Cash Used in Investing Activities		(3,722)		(1,482)
Net Cash Used in Financing Activities		(2,527)		(4,625)
Net Increase in Cash and Cash Equivalents and Restricted Cash	$	15,951	$	18,482

Cash Flows from Operating Activities.    Net cash provided by operating activities for the three months ended March 31, 2018 and 2017, were $24.6 million and $22.2 million, respectively. Net income, net of the non-cash impact of the provision for loan losses was $18.9 million and $11.2 million for the three months ended March 31, 2018 and 2017, respectively.

Cash Flows from Investing Activities.    Net cash used in investing activities during 2018 was $1.5 million.  The primary use of cash was $1.3 million in purchases of leasehold improvements and equipment.  Net cash used in investing activities during 2017 was $3.7 million. The primary uses of cash were $2.7 million in loan originations and $1.0 million in purchases of leasehold improvements and equipment. 

Cash Flows from Financing Activities.    Net cash used in financing activities during 2018 was $4.6 million.  The primary use of cash was $4.4 million in debt issuance costs.  Net cash used in financing activities during 2017 was $2.5 million. The primary use of cash was $2.3 million in payments on a line of credit.

Financing Instruments

The Indentures governing our senior secured notes contain certain covenants and events of default that are customary with respect to non-investment grade debt securities, including limitations on our ability to incur additional indebtedness, pay dividends on or make other distributions or repurchase our capital stock, make certain investments, enter into certain types of transactions with affiliates, create liens, and sell certain assets, or merge with or into other companies. The agreement governing our $47.0 million revolving credit facility contains restrictive covenants that limit our ability to incur additional indebtedness, pay dividends on or make other distributions or repurchase our capital stock, make certain investments, enter into certain types of transactions with affiliates, create liens, and sell certain assets, or merge with or into other companies, in each case to the same extent as the indentures governing our notes. We were in compliance with these covenants as of March 31, 2018.

On March 30, 2018, the Company amended its revolving credit facility with Victory Park Management, LLC, as administrative agent, and certain of its affiliates as lenders, which we refer to collectively as VPC, to extend the maturity date to April 4, 2019. The amendment added covenants addressing daily minimum liquidity and asset coverage tests, weekly operational reporting requirements and monthly EBITDA and borrowing base coverage tests. Additionally, the Company is required to use commercially reasonable efforts to obtain reasonably satisfactory modification of the 2019 and 2020 Notes.

The non-guarantor and unrestricted subsidiaries, created to acquire loans from the retail and internet portfolios, amended its $60.0 million note on March 30, 2018 to extend the maturity date to April 4, 2019. The amendment increases the administrative fee to 0.95% and permits an additional extension of the facility maturity date to April 2021 if certain conditions are met. The amendment allows for additional short term loans within the borrowing base and includes additional covenants addressing daily minimum cash and asset coverage tests, dividend limits, weekly operational reporting requirements, borrowing base reporting, and a monthly consolidated EBITDA test.

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Capital Expenditures

During the three months ended March 31, 2018, the Company spent $1.3 million on capital expenditures and $1.0 million during the comparable period in the prior year. The increase is primarily in our Mississippi market due to new stores added during the prior year.

Seasonality

Our business is seasonal based on the liquidity and cash flow needs of our customers. Customers cash tax refund checks primarily in the first calendar quarter of each year which is traditionally our strongest check cashing quarter. We typically see our loan portfolio decline in the first quarter as a result of the consumer liquidity created through income tax refunds. Following the first quarter, we typically see our loan portfolio expand through the remainder of the year with the third and fourth quarters showing the strongest loan demand due to the holiday season.

Contractual Obligations and Commitments

On December 20, 2013, and June 19, 2014, the Company created non-guarantor subsidiaries in order to acquire loans from the retail and internet portfolios. The non-guarantor subsidiaries funding were the proceeds from $40.0 million and $7.3 million installment notes, which were used to acquire loans from guarantor subsidiaries. On April 25, 2017, the Company’s non-guarantor and unrestricted subsidiary, CCFI Funding II, LLC and Ivy Funding Nine, LLC, amended and restated its existing $40.0 million note to increase the borrowing capacity up to $60.0 million. The $60.0 million note has a maturity date of January 2019 and an interest rate of 16.75% and a monthly administrative fee of 0.75% on the outstanding principal balance of the note. The note also has a cross-default to the Company’s revolving credit facility, dividend restrictions, borrowing base testing, and a cash flow coverage test. In addition, the note contains make-whole provisions in the event of a prepayment. The proceeds from the amended note were used to acquire loans from guarantor subsidiaries. In connection with the amendment, the other non-guarantor and unrestricted subsidiary’s $7.3 million note was satisfied in full.

On March 30, 2018, the April 25, 2017, note was further amended to extend the maturity date to April 4, 2019. The amendment increased the administrative fee to 0.95% and permits an additional extension of the facility maturity date to April 2021 if certain conditions are met. The amendment allows for additional short-term loans within the borrowing base and includes additional covenants addressing daily minimum cash and asset coverage tests, dividend limits, weekly operational reporting requirements, borrowing base reporting, and a monthly consolidated EBITDA test.

On July 19, 2014, a guarantor subsidiary of the Company entered in to a $1.4 million term note with a nonrelated entity for the acquisition of a share of an airplane. We recorded our $1.1 million share of the joint note, but both parties are joint and severally liable. The joint note had an outstanding balance of $1.2 million at March 31, 2018 and our share of the note was $0.9 million.

On May 24, 2016, a guarantor subsidiary of the Company entered into a $1.2 million term note for a fractional share of an airplane.

Impact of Inflation

Our results of operations are not materially impacted by fluctuations in inflation.

Balance Sheet Variations

Cash and cash equivalents, accounts payable, accrued liabilities, money orders payable and revolving advances vary because of seasonal and day-to-day requirements resulting primarily from maintaining cash for cashing checks and making loans, and the receipt and remittance of cash from the sale of prepaid debit cards, wire transfers, money orders and the processing of bill payments.

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Loan Portfolio

As of March  31, 2018, we were licensed to offer loans in 33 states. We have established a loan loss allowance in respect of our loans receivable at a level that our management believes to be adequate to absorb known or probable losses from loans made by us and accruals for losses in respect of loans made by third parties that we guarantee. Our policy for determining the loan loss allowance is based on historical experience, as well as our management’s review and analysis of the payment and collection of the loans within prior periods. All loans and services, regardless of type, are made in accordance with state regulations, and, therefore, the terms of the loans and services may vary from state-to-state. Loan fees and interest are earned on loans. Products which allow for an upfront fee are recognized over the loan term. Other products’ interest is earned over the term of the loan.

As of March  31, 2018, and December 31, 2017, our total finance receivables net of unearned advance fees were approximately $86.7 million and $110.1 million, respectively.

Off-Balance Sheet Arrangements

In certain markets, we arrange for consumers to obtain consumer loan products from one of several independent third-party lenders whereby we act as a facilitator. For consumer loan products originated by third-party lenders under these programs, each lender is responsible for providing the criteria by which the consumer’s application is underwritten and, if approved, determining the amount of the consumer loan. The Company in turn is responsible for assessing whether or not the Company will guarantee such loans. When a consumer executes an agreement with the Company under these programs, the Company agrees, for a fee payable to the Company by the consumer, to provide certain services to the consumer, one of which is to guarantee the consumer’s obligation to repay the loan received by the consumer from the third-party lender if the consumer fails to do so. The guarantee represents an obligation to purchase specific loans that go into default. As of March 31, 2018, and December 31, 2017, the outstanding amount of active consumer loans guaranteed by the Company was $29.6 million and $37.0 million, respectively. The accrual for third party loan losses, which represents the estimated fair value of the liability for estimated losses on consumer loans guaranteed by the Company, was $3.8 million and $4.8 million as of March  31, 2018, and December 31, 2017, respectively.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As of March  31, 2018, we have no material market risk sensitive instruments entered into for trading or other purposes, as defined by GAAP.

Interest rate risk

The cash and cash equivalents reflected on our balance sheet represent largely uninvested cash in our branches and cash-in-transit. The amount of interest income we earn on these funds will decline with a decline in interest rates. However, due to the short-term nature of short-term investment grade securities and money market accounts, an immediate decline in interest rates would not have a material impact on our financial position, results of operations or cash flows.

As of March  31, 2018, we had $358.9 million of indebtedness, of which, $47.0 million outstanding under our revolving credit facilities is subject to variable interest rates based on Prime and LIBOR rates.

ITEM 4.  CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures, as defined in Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the “Exchange Act,” that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management,

39

including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. The Company’s management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on the evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of March  31, 2018.

Internal Control Over Financial Reporting

There were no changes in the Company’s internal control over financial reporting, as defined in Rule 15d-15(f) under the Exchange Act, during the quarter ended March  31, 2018, that have materially affected, or are reasonably likely to affect, the Company’s internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

We and our subsidiaries are party to a variety of legal, administrative, regulatory and government proceedings, claims and inquiries arising in the normal course of business. While the results of these proceedings, claims and inquiries cannot be predicted with certainty, we believe that the final outcome of the foregoing will not have a material adverse effect on our financial condition, results of operations or cash flows. Further, legal proceedings have and may in the future be instituted against us that purport to be class actions or multiparty litigation. In most of these instances, we believe that these actions are subject to arbitration agreements and that the plaintiffs are compelled to arbitrate with us on an individual basis. In the event that a lawsuit purporting to be a class action is certified as such, the amount of damages for which we might be responsible is uncertain. In addition, any such amount would depend upon proof of the allegations and on the number of persons who constitute the class of affected persons.

ITEM 1A.  RISK FACTORS.

There has been no material changes with respect to the risk factors disclosed under the “Item 1A Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017.

ITEM 6.  EXHIBITS. 

The following exhibits are filed or furnished as part of this report: 

Exhibit No.	Description of Exhibit
10.41	Option Award Agreement (2011 Management Equity Incentive Plan, as amended), dated as of January 1, 2018 between Community Choice Financial, Inc. and William E. Saunders*
10.42	Option Award Agreement (2011 Management Equity Incentive Plan, as amended), dated as of January 1, 2018 between Community Choice Financial, Inc. and Kyle Hanson*
10.43	Option Award Agreement (2011 Management Equity Incentive Plan, as emended), dated as of January 1, 2018 between Community Choice Financial, Inc. and Michael Durbin*
10.44	Option Award Agreement (2011 Management Equity Incentive Plan, as amended), dated as of January 1, 2018 between Community Choice Financial, Inc. and Bridgette Roman*
31.1	Certification Pursuant to Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by the Chief Executive Officer
31.2	Certification Pursuant to Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, signed by the Chief Financial Officer
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by the Chief Executive Officer
32.2	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by the Chief Financial Officer
101	Interactive Data File: (i) Consolidated Balance Sheets as of March  31, 2018 (unaudited) and December 31, 2017; (ii) Consolidated Statements of Operations for the Three Months Ended March  31, 2018 (unaudited) and March  31, 2017 (unaudited); (iii) Consolidated Statements of Stockholders’ Equity for the Three Months Ended March  31, 2018 (unaudited); (iv) Consolidated Statements of Cash Flows for the Three Months Ended March  31, 2018 (unaudited) and March  31, 2017 (unaudited); and (v) Notes to Consolidated Financial Statements (unaudited)—submitted herewith pursuant to Rule 406T
*	Indicates a management contract or compensation plan or arrangement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: May 14, 2018

Community Choice Financial Inc. and Subsidiaries
(registrant)

/s/ MICHAEL DURBIN

Michael Durbin

Chief Financial Officer

Principal Financial and

Principal Accounting Officer

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EX-10.41

Exhibit 10.41

Community Choice Financial Inc.

2011 Management Equity Incentive Plan

Option Award Agreement

GRANT TO:  William E. Saunders, Jr.

THIS AGREEMENT (the “Agreement”) is made as of January 1, 2018, between Community Choice Financial Inc., an Ohio corporation (together with its successors, the “Company”), and William E. Saunders, Jr., who is an employee of the Company or one of its Subsidiaries (the “Grantee”).  Capitalized terms, unless defined in this Agreement, shall have the same meanings as in the Plan (as defined below). 

WHEREAS, in connection with the Grantee’s employment with the Company or one of its Subsidiaries, the Company granted to the Grantee as of January 1, 2018 (the “Grant Date”) an option to purchase 30,051 common shares, par value $0.01, of the Company (“Options”) pursuant to the terms and conditions of this Agreement and the Company’s 2011 Management Equity Incentive Plan (the “Plan”).

WHEREAS, the Board or its duly authorized designee has determined that it would be to the advantage, and in the best interest, of the Company and its shareholders to grant the Options provided for herein to the Grantee as an incentive for increased efforts during employment with the Company or one of its Subsidiaries.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. GRANT OF Options AWARD

(a) Grant.  Subject to the terms and conditions of the Plan and this Agreement, the Company has granted to the Grantee Options for 30,051 shares, which will be earned based on the vesting provision of Section 2(a).

(b) Plan.  The foregoing award was granted under the Plan, which is incorporated herein by this reference and made a part of this Agreement.

(c) No Rights as Stockholder.  It shall be understood that none of the terms contained any such rights unless and until such Grantee receives Shares in connection with the exercise of Options.

2. RIGHT TO EXERCISE; VESTING

(a) Vesting.  Subject to the provisions of this Agreement, the Options granted hereunder shall vest as of the earlier of: (a) December 31, 2018, provided however that Grantee is employed by the Company or one of its subsidiaries as of that date, or (b) the

Termination Date (as hereinafter defined) but only if the Termination Event is either (i) a termination without Cause, or (ii) a resignation with Good Reason.

(b) Effect of Vesting.  For each vested Option the Grantee may exercise such Option for one share.

3. Exercise Procedures

(a) Notice of Exercise.  The Grantee may exercise its Options prior to their expiration as set forth in Section 6 to the extent they are vested by giving written notice to the Company in form and substance reasonably satisfactory to the Company (such notice, a “Notice of Exercise”) specifying the election to exercise such Options, the number of vested Options which are being exercised and the form of payment.  The Notice of Exercise shall be signed by the Grantee.  The Grantee shall deliver to the Company, at the time of giving the notice, payment in a form permissible under Section 4 for the full amount of the Exercise Price and, if such person is not then party to the Stockholders Agreement, such person shall be required to execute a Joinder Agreement.

(b) Issuance of Shares.  After receiving a properly completed and executed Notice of Exercise and payment for the full amount of the Exercise Price as required by Section 3(a) and, if applicable, an executed Joinder Agreement, the Company shall cause to be issued a certificate or certificates for the Purchased Shares (as defined below), registered in the name of the Grantee (or in the names of such person and his spouse as community property or as joint tenants with right of survivorship), provided that as a condition to the issuance of Purchased Shares hereunder, the Grantee shall make, as of the time of issuance of such Purchased Shares, representations and warranties in a form satisfactory to the Company and substantially similar to those contained in Exhibit A.  In connection with any exercise of these Options, the Person exercising these Options shall deliver to the Company a duly executed blank share power in the form attached hereto as Exhibit B.  The date of the issuance of the Purchased Shares by the Company to the Grantee, the “Exercise Date”.

(c) Withholding Requirements.  The Company may withhold any tax (or other governmental obligation) required to be withheld in connection with the exercise of the Options, and as a condition to the settlement of any exercise of the Options.  Such withholding may be made from any source (including any salary or other compensation payable to the Grantee), and the Grantee shall make arrangements satisfactory to the Company to enable it to satisfy all such withholding requirements as a condition to the exercise of the Options (including by remitting to the Company an amount in cash sufficient to satisfy the withholding obligation).  For the avoidance of doubt, the Company will not withhold any amounts greater than the statutory minimum.

4. payment of EXERCISE price

(a) Cash or Check.  In connection with an exercise of the Options, all or part of the Exercise Price may be paid in cash or by check.

(b) Net Exercise.  Notwithstanding anything in this Agreement to the contrary, in connection with an exercise of the Options, all or part of the Exercise Price may be paid by reducing the number of Shares being purchased pursuant to such exercise by the number of such Shares having a Fair Market Value equal to the Exercise Price.

(c) Other Methods of Payment for Shares.  At the sole discretion of the Board, and subject to applicable law, all or any part of the Exercise Price and any applicable withholding requirements may be paid by any other method permissible at the time under the terms of the Plan.

5. SECURITIES LAW ISSUES, TRANSFER restrictionS

(a) Grantee Acknowledgements and Representations.  The Grantee understands and agrees that:  (i) the Options have not been registered under the Securities Act, (ii) the Options are restricted securities under the Securities Act and (iii) the Options may not be resold or transferred unless they are first registered under the Securities Act or unless an exemption from such registration is available.  The Grantee hereby makes the representations and warranties set forth in Exhibit A hereto.

(b) No Registration Rights.  The Company may, but shall not be obligated to, register or qualify the issuance of Purchased Shares to the Grantee, or the resale of any such Purchased Shares by the Grantee under the Securities Act or any other applicable law. 

(c) Transfers.  No Option shall be transferable to any Person for any reason. Any attempt to Transfer any Option shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer.  Any Purchased Shares shall be subject to the restrictions on Transfer as set forth in Article 3 of the Stockholders Agreement, except with respect to a Transfer by will or by the laws of descent and distribution.  Unless otherwise permitted pursuant to the Stockholders Agreement, the Grantee shall not Transfer any Purchased Shares (i) except in compliance with the provisions of Article 3 of the Stockholders Agreement, and (ii) unless the transferee shall have agreed in writing to be bound by the terms of this Agreement in a manner acceptable to the Board and otherwise acknowledging that such Purchased Shares are subject to the restrictions set forth in this Agreement.  Any attempt to Transfer any Purchased Shares not in compliance with this Agreement shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer. The Grantee acknowledges that the transfer restrictions contained in this Agreement are reasonable and in the best interests of the Company.

6. TERM of Grant.

Subject to the provisions of Section 2(a), the Options subject to in this Agreement shall expire on the tenth anniversary following the date of this Agreement, except in (a) the case of death or Disability, in which case the Options subject to this Agreement terminate on the first anniversary of the date of death or Disability, and (b) the case of Grantees who have not been employed at

least five years as of the date of a Termination Event, as defined below, in which case the Options subject to this Agreement terminate on the Termination Date, also defined below. 

7. Right of Repurchase upon TERMINATION OF EMPLOYMENT 

(a) Repurchase Rights.

1. Upon the termination of employment of the Grantee by the Company or any of its Subsidiaries for any reason (the reason for the termination of such employment, the “Termination Event” and the date of such termination, the “Termination Date”), subject to the provisions of this Section 7 and the prior approval of the Compensation Committee of the Board (or if there is no such Compensation Committee, the Board), the Company shall have the right (but not the obligation) to purchase, and if such right is exercised, the Grantee shall sell, and shall cause any Permitted Transferees of the Grantee to sell (and such Permitted Transferees shall sell), to the Company, all or any portion (as determined by the Company) of the Purchased Shares (if any) owned by the Grantee or his Permitted Transferees at a price per Purchased Share equal to an amount (the “Termination Price”) (as determined pursuant to Section 7(b) below); provided,  that the parties acknowledge that any unvested Options held by the Grantee as of the Termination Date shall be cancelled pursuant to this Agreement.

2. With respect to the Purchased Shares, the Company shall notify the Grantee in writing, within the Call Period whether the Company will exercise its right to purchase the Purchased Shares (the date on which the Grantee is so notified, the “Call Notice Date”). 

3. The closing of the purchase by the Company of Purchased Shares pursuant to this Section 7 shall take place at the principal office of the Company, on the date chosen by the Company, which date shall, except as may be reasonably necessary to determine the Termination Price, in no event be more than 45 days after the Call Notice Date.  At such closing, (A) the Company shall pay the Grantee and/or such Grantee’s Permitted Transferees, as applicable, against delivery of duly endorsed certificates described below representing such Purchased Shares, the aggregate Termination Price by wire transfer of immediately available federal funds and (B) the Grantee and/or such Grantee’s Permitted Transferees, as applicable, shall deliver to the Company a certificate or certificates representing the Purchased Shares to be purchased by the Company, duly endorsed, or with share (or equivalent) powers duly endorsed, for transfer with signature guaranteed, free and clear of any lien or encumbrance, with any necessary share (or equivalent) transfer tax stamps affixed. The delivery of a certificate or certificates for the Purchased Shares by any Person selling such Purchased Shares pursuant to this Section 7(a)(iii) shall be deemed a representation and warranty by such Person that: (w)

such Person has full right, title and interest in and to such Purchased Shares; (x) such Person has all necessary power and authority and has taken all necessary action to sell such Purchased Shares as contemplated; (y) such Purchased Shares are free and clear of any and all liens or encumbrances; and (z) there is no adverse claim with respect to such Purchased Shares.

(b) Termination Pricing.  The Termination Price of any Purchased Share shall be determined as follows:

1. If the Termination Event was a resignation by the Grantee with Good Reason or termination of the employment of the Grantee by the Company or any of its Subsidiaries without Cause, the Termination Price for such Purchased Share shall be the Fair Market Value on the FMV Calculation Date,

2. if the Termination Event was as a result of the death or Disability of the Grantee, the Termination Price for such Purchased Share shall be the Fair Market Value on the Termination Date, and 

3. if the Termination Event was a termination of the employment of the Grantee by the Company or any of its Subsidiaries with Cause, or was a resignation by the Grantee without Good Reason, the Termination Price for such Purchased Share shall be the lower of (A) the Fair Market Value on the FMV Calculation Date or (B) the Exercise Price per Share.

(c) Payment Terms.  In the event that the Company exercises a Right of Repurchase pursuant to Section 7 of this Agreement, the Company shall pay the Termination Price in cash; provided,  however, that if the Company is at the time of the Purchase Closing prohibited from purchasing all or any portion of such Purchased Shares (i) because restrictive covenants or other provisions contained in the documents evidencing such entity’s or any of its Affiliates’ indebtedness for borrowed money do not permit or allow such entity to make such payments in cash in whole or in part; (ii) pursuant to applicable law; or (iii) that the Grantee was terminated for Cause, resigned without Good Reason, or if the Grantee was not employed by the Company or one of its Subsidiaries for at least five years prior to the termination for Cause or resignation without Good Reason , then, the Termination Price may be paid by the execution and delivery by the Company of a promissory note or other deferred cash payment arrangement (if applicable, any promissory note to be subordinated to the indebtedness for borrowed money of such company or any of its Affiliates) bearing interest at the prime rate, as published in the Wall Street Journal, Eastern edition, on the first Business Day immediately prior to the day on which such promissory note or other deferred cash payment is issued, with principal and accrued interest payable at such time as is required in the Board’s determination to ensure that any payment pursuant to such promissory note or other deferred cash payment arrangement is not prohibited because of any of the matters described in clauses (i) or (ii) of this Section 7(c) above. 

8. ADJUSTMENT OF SHARES

In the event of a Recapitalization, the terms of this Award (including, without limitation, the number and kind of Shares subject to this Award) shall be adjusted as set forth in Section 13 (a) of the Plan.  In the event that the Company is a party to a merger or consolidation, this Award shall be subject to Section 13(b) of the Plan.

9. MISCELLANEOUS PROVISIONS

(a) No Retention Rights.  Nothing in this Agreement or in the Plan shall confer upon the Grantee any right to continue in Service or interfere with or otherwise restrict in any way the rights of the Company or any Subsidiary employing the Grantee, which rights are hereby expressly reserved by the Company and any Subsidiary employing the Grantee, to terminate the Grantee’s Service at any time and for any reason, with or without Cause.

(b) Notices.  All notices, requests and other communications under this Agreement shall be in writing and shall be delivered in person (by courier or otherwise), mailed by certified or registered mail, return receipt requested,or sent by facsimile transmission, as follows:

If to the Company, to:

Community Choice Financial Inc.

7001 Post Road, Suite 200

Dublin, OH 43016

Attention:   Stock Option Administrator

If to the Grantee, to the address that he/she most recently provided to the Company,

(c) or, in each case, at such other address or fax number as such party may hereafter specify for the purpose of notices hereunder by written notice to the other party hereto.  All notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a Business Day in the place of receipt.  Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt.  Any notice, request or other written communication sent by facsimile transmission shall be confirmed by certified or registered mail, return receipt requested, posted within one Business Day, or by personal delivery, whether by courier or otherwise, made within two Business Days after the date of such facsimile transmissions; provided that such confirmation mailing or delivery shall not affect the date of receipt, which will be the date that the facsimile successfully transmitted the notice, request or other communication.

(d) Entire Agreement.  This Agreement and the Plan, together with the Stockholders Agreement and the other agreements referred to herein and therein and any schedules, exhibits and other documents referred to herein or therein, constitute the entire agreement and understanding among the parties hereto in respect of the subject matter hereof and thereof and supersede all prior and contemporaneous arrangements, agreements and

understandings, both oral and written, whether in term sheets, presentations or otherwise, among the parties hereto, or between any of them, with respect to the subject matter hereof and thereof.

(e) Amendment; Waiver.  No amendment or modification of any provision of this Agreement shall be effective unless signed in writing by or on behalf of the Company and the Grantee, except that the Company may amend or modify the Agreement without the Grantee’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement.  The failure of the Company in any instance to exercise the Right of Repurchase shall not constitute a waiver of any other repurchase rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Grantee.  No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.  Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which made or given.

(f) Assignment.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Grantee except pursuant to a Transfer in accordance with the provisions of this Agreement.

(g) Successors and Assigns; No Third Party Beneficiaries.  This Agreement shall inure to the benefit of and be binding upon the Company and the Grantee and their respective heirs, successors, legal representatives and permitted assigns.  Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Company and the Grantee, and their respective heirs, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

(h) Governing Law, Venue.  This Agreement and any matters or disputes related to, in connection with, or arising under this Agreement shall be governed by the laws of the State of Ohio, without regard to the conflicts of laws rules of such state.  Any legal action or proceeding with respect this Agreement shall be brought in the federal or state court sitting in the State of Ohio, and, by execution and delivery of this Agreement, each party hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the exclusive jurisdiction of such courts.  Each party irrevocably waives any objection which it may now or hereafter have to the laying of venue of the aforesaid actions or proceedings arising out of or in connection with this Agreement in the courts referred to in this paragraph and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(i) Waiver of Jury Trial.   The Grantee hereby irrevocably waives all right of trial by jury in any legal action or proceeding (including counterclaims) relating to or arising out of or in connection with this Agreement or any of the transactions or

relationships hereby contemplated or otherwise in connection with the enforcement of any rights or obligations hereunder.

(j) Interpretation.  Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation apply: 

i. Headings.  The division of this Agreement into Sections and other subdivisions and the insertion of headings are for convenience of reference only and do not alter the meaning of, or affect the construction or interpretation of, this Agreement.

ii. Section References.  All references in this Agreement to any “Section” are to the corresponding Section of this Agreement.

iii. Schedules/Exhibits.  Any capitalized terms used in any Schedule or Exhibit to this Agreement but are not otherwise defined therein have the meanings set forth in this Agreement.

(k) Severability.  If any provision of this Agreement is invalid, illegal, or incapable of being enforced by any law, all other provisions of this Agreement remain in full force and effect so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party.  If any provision of this Agreement is held to be invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

(l) Counterparts.  The parties may execute this Agreement in one or more counterparts, each of which constitutes an original copy of this Agreement and all of which, collectively constitute only one agreement.  The signatures of all the parties need not appear on the same counterpart.

(m) Grantee Undertaking.  The Grantee agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to carry out or effect one or more of the obligations or restrictions imposed on either the Grantee or upon the Options or any Purchased Shares pursuant to the provisions of this Agreement. 

(n) Plan; Stockholders Agreement; Counsel.  The Grantee acknowledges and understands that material definitions and provisions concerning the Options or any Purchased Shares and the Grantee’s rights and obligations with respect thereto are set forth in the Plan and the Stockholders Agreement.  The Grantee has had the opportunity to retain counsel, and has read carefully, and understands, the provisions of such documents. 

10. Definitions

“Affiliate” shall mean, with respect to any specified Person, (i) any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under

common control with, such specified Person (for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise); provided,  however, that neither the Company nor any of its Subsidiaries shall be deemed an Affiliate of any of the Stockholders (and viceversa), and (ii) if such specified Person is an investment fund, any other investment fund the primary investment advisor to which is the primary investment advisor to such specified Person.

“Board” means the Board of Directors of the Company, as constituted from time to time or, if a Committee has been appointed, such Committee.

“Business Day” has the meaning ascribed to such term in the Stockholders Agreement. 

“Call Period” shall mean from the Termination Date until:

if the Termination Event is a termination of the employment for any reason other than death or Disability of the Grantee, the later of (A) the date that is 60 days after such Termination Date and (B) the date that is 190 days after the Exercise Date,

if the Termination Event is a termination of the employment of the Grantee by the Company or any of its Subsidiaries as a result of the death or Disability of the Grantee, the date that is the later of (A) 60 days after the Termination Date or (B) the date which is 60 days after the Exercise Date, or

“Cause” shall mean:

(i)Grantees’s failure or refusal to comply, on a timely basis, with any lawful direction or instruction of the Board;

(ii)Grantee’s gross negligence or willful misconduct in the performance of his/her duties as an employee of the Company;

(iii)Grantee’s commission of fraud, embezzlement, misappropriation of funds, breach of fiduciary duty or act of dishonesty against the Company;

(iv)Conviction of Grantee of a felony or entry by Grantee of a plea of nolo contendre or a plea of guilty under an indictment to a felony; or

(v)Grantee’s habitual drug addiction or intoxication.

The Company shall have the right to terminate Grantee’s employment for Cause. 

 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder. 

“Committee” means the compensation committee of the Board of Directors of the Company. 

 “Disability” means Grantee’s incapacity due to physical or mental illness such that  Grantee is unable to perform his/her duties for 180 consecutive days and, within 30 days after a notice of termination, which notice of termination may not be given until the expiration of such consecutive 180 day period, is given to Grantee, Grantee has not returned to work.    

“Exercise Price” means $1.00.

“Fair Market Value” or “FMV” with respect to a share of stock of the Company, shall mean (i) in the event that such shares are listed on an established U.S. exchange or through the NASDAQ National Market or any established over-the-counter trading system, the average of the closing prices of such Group Equity Securities on such exchange if listed or, if not so listed, the average bid and asked price of such shares reported on the NASDAQ National Market or any established over-the-counter trading system on which prices for such shares are quoted, in each case, for a period of twenty trading days prior to such date of determination, or (ii) if such shares are not publicly traded, a good faith determination by the Board through a reasonable application of a reasonable valuation method.  Such determination shall be conclusive and binding on all persons. 

“FMV Calculation Date” means:

i. if the Termination Event is a termination by the Company or any of its Subsidiaries without Cause, a resignation by the Grantee with Good Reason or a resignation by the Grantee without Good Reason after three years of Service:

ii. if the Exercise Date occurred 180 days or more before the Termination Date, the Termination Date, and

iii. if the Exercise Date occurred 179 days or less before the Termination Date or occurs after the Termination Date, then the Call Notice Date;

iv. if the Termination Event is as a result of the death or Disability of the Grantee, then the Termination Date; and

v. if the Termination Event is a termination by the Company or any of its Subsidiaries with Cause, or a resignation by the Grantee without Good Reason during the Grantee’s, then the Termination Date.

“Good Reason”  Grantee may resign for “Good Reason” within 30 days after Grantee has actual knowledge of the occurrence, without the written consent of Grantee, of one of the following events:

(i)a reduction in Grantee’s base salary, or non-timely payment of base salary or earned annual bonus not cured by the Company within five business days;  

(ii)a material diminution in Grantee’s duties or responsibilities not cured by the Company within 20 days after written notice to the Company. For the purposes of this section, a “material diminution in Grantee’s duties or responsibilities” shall not include a realignment or reorganization of executive responsibilities as the result of Company growth or contraction or the growth or contraction of the Company’s management team, but shall include the removal or withdrawal of substantially all of the Executive’s duties or responsibilities; or

(iii)Grantee’s retirement providedhowever that Grantee shall give not less than 30 days written notice thereof.

“Joinder Agreement” means an agreement substantially in the form of Exhibit A of the Stockholders Agreement, pursuant to which the Grantee shall become a party to the Stockholders Agreement and subject to all of the rights, restrictions and obligations contained therein.

“Permitted Transferee”has the meaning ascribed to such term in the Stockholders Agreement.

“Person” means an individual, corporation, limited liability company, partnership, association, trust or other entity or organization. 

“Purchased Shares” means any Shares issued pursuant to the exercise of any Option in accordance with the terms of this Agreement.

“Right of Repurchase” means the Company’s right of repurchase described in Section 7 of this Agreement.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

“Service” means service as an employee. 

“Share(s)” means common share(s) of the Company.

“Stockholders Agreement” means that certain Stockholders Agreement dated as of April 28, 2011, by and among the Company, the Grantee and the other parties thereto (as the same shall be amended, modified or supplemented from time to time).  

“Subsidiary”  means, with respect to the Company, any other Person in which the Company, directly or indirectly through one or more Affiliates or otherwise, beneficially owns at least 50% of either the ownership interest (determined by equity or economic interests) in, or the voting control of, such other Person. 

“Transfer” has the meaning ascribed in such term in the Stockholders Agreement. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

COMMUNITY CHOICE FINANCIAL INC.

By: /s/ Kyle F. Hanson

Name:  Kyle F. Hanson

Title:    President

/s/ William E. Saunders, Jr.

William E. Saunders, Jr.

EXHIBIT A

to Option Award Agreement

Investment Representations and Warranties

The Grantee hereby represents and warrants to the Company that:

1. The Options and Purchased Shares received by him will be held by him for investment only for his own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee has no current intention of selling, granting participation in or otherwise distributing the Options or Purchased Shares in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity, or to any third person or entity, with respect to any of the Options or Purchased Shares, in each case, in violation of applicable U.S. federal or state or foreign securities laws.

2. The Grantee understands that although the Company has a pending S-1 Registration Statement with the U.S. Securities and Exchange Commission that as of the date of this grant, the issuance of the Options and Purchased Shares have not been registered under the Securities Act or any applicable U.S. state or foreign securities laws, and that the Options and Purchased Shares are being issued in reliance on an exemption from registration, which exemption depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Grantee’s representations as expressed herein.

3. The Grantee has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of his owning the Options and Purchased Shares.  The Grantee is a sophisticated investor, has relied upon independent investigations made by the Grantee and, to the extent believed by the Grantee to be appropriate, the Grantee’s representatives, including the Grantee’s own professional, tax and other advisors, and is making an independent decision to invest in the Options and Purchased Shares.  The Grantee has been furnished with such documents, materials and information that the Grantee deems necessary or appropriate for evaluating an investment in the Company, and the Grantee has read carefully such documents, materials and information and understands and has evaluated the types of risks involved with holding the Options and Purchased Shares.  The Grantee has not relied upon any representations or other information (whether oral or written) from the Company or its shareholders, directors, officers or affiliates, or from any other person or entity, in connection with his investment in the Options and Purchased Shares.  The Grantee acknowledges that the Company has not given any assurances with respect to the tax consequences of the ownership and disposition of the Options and Purchased Shares.

4. The Grantee has had, prior to his being granted the Options and Purchased Shares, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the transactions contemplated by the Agreement and the Grantee’s holding of the Options and Purchased Shares and to obtain additional information necessary to verify the accuracy of any information furnished to his or to which she had access.  The Grantee confirms that she has satisfied himself with respect to any of the foregoing matters.

5. The Grantee understands that no U.S. federal or state or foreign agency has passed upon the Options or Purchased Shares or upon the Company, or upon the accuracy, validity or completeness of any documentation provided to the Grantee in connection with the transactions contemplated by the Agreement, nor has any such agency made any finding or determination as to holding the Options or Purchased Shares.

6. The Grantee understands that there are substantial restrictions on the transferability of the Options and Purchased Shares and that on the date of the Agreement and for an indefinite period thereafter there will be no public market for the Options or Purchased Shares and, accordingly, it may not be possible for the Grantee to liquidate his investment in case of emergency, if at all.  In addition, the Grantee understands that the Agreement and Stockholders Agreement contain substantial restrictions on the transferability of the Options and Purchased Shares and provide that, in the event that the conditions relating to the transfer of any Options or Purchased Shares in such document has not been satisfied, the holder shall not transfer any such Options or Purchased Shares, and unless otherwise specified the Company will not recognize the transfer of any such Options or Purchased Shares on its books and records or issue any share certificates representing any such Options or Purchased Shares, and any purported transfer not in accordance with the terms of the Agreement or the Stockholders Agreement shall be void.  As such, Grantee understands that: a restrictive legend or legends in a form to be set forth in the Agreement and the Stockholders Agreement will be placed on the certificates representing the Options and Purchased Shares; a notation will be made in the appropriate records of the Company indicating that each of the Options and Purchased Shares are subject to restrictions on transfer and, if the Company should at some time in the future engage the services of a securities transfer agent, appropriate stop-transfer instructions will be issued to such transfer agent with respect to the Options and Purchased Shares; and the Grantee will sell, transfer or otherwise dispose of the Options or Purchased Shares only in a manner consistent with its representations set forth herein and then only in accordance with the Agreement and the Stockholders Agreement.

7. The Grantee understands that (i) the neither the Options nor the Purchased Shares may not be sold, transferred or otherwise disposed of without registration under the Securities Act or an exemption therefrom, (ii) the Options and Purchased Shares have not been registered under the Securities Act; (iii) the Options and Purchased Shares must be held indefinitely and she must continue to bear the economic risk of holding the Options and Purchased Shares unless such Options and Purchased Shares are subsequently registered under the Securities Act or an exemption from such registration is available; (iv) the Grantee is prepared to bear the economic risk of holding the Options and Purchased Shares for an indefinite period of time; (v) it is not anticipated that there will be any

public market for the Options or Purchased Shares; (vi) the Options and Purchased Shares are characterized as “restricted securities” under the U.S. federal securities laws; and (vii) the Options and Purchased Shares may not be sold, transferred or otherwise disposed of except in compliance with federal, state and local law.

8. The Grantee understands that an investment in the Options or Purchased Shares is not recommended for investors who have any need for a current return on this investment or who cannot bear the risk of losing their entire investment.  In that regard, the Grantee understands that his holding the Options and Purchased Shares involves a high degree of risk of loss.  The Grantee acknowledges that: (i) he/she has adequate means of providing for his current needs and possible personal contingencies and has no need for liquidity in this investment; (ii) his/her commitment to investments which are not readily marketable is not disproportionate to his net worth; and (iii) his/her holding the Options and Purchased Shares will not cause his overall financial commitments to become excessive. 

EXHIBIT B

to Option Award Agreement

Share Power

IRREVOCABLE STOCK POWERS

COMMUNITY CHOICE FINANCIAL INC.

FOR VALUE RECEIVED, William E. Saunders, Jr., does hereby sell, assign and transfer unto ____________________    _______________ Common Shares of Community Choice Financial Inc., par value $0.01, represented by Certificate No. ___ herewith and does hereby irrevocably constitute and appoint ______________________ attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises.   

Dated:  _________________

By: William E. Saunders, Jr

William E. Saunders, Jr.

EX-10.42

Exhibit 10.42

Community Choice Financial Inc.

2011 Management Equity Incentive Plan

Option Award Agreement

GRANT TO:  Kyle F. Hanson

THIS AGREEMENT (the “Agreement”) is made as of January 1, 2018, between Community Choice Financial Inc., an Ohio corporation (together with its successors, the “Company”), and Kyle F. Hanson, who is an employee of the Company or one of its Subsidiaries (the “Grantee”).  Capitalized terms, unless defined in this Agreement, shall have the same meanings as in the Plan (as defined below). 

WHEREAS, in connection with the Grantee’s employment with the Company or one of its Subsidiaries, the Company granted to the Grantee as of January 1, 2018 (the “Grant Date”) an option to purchase 18,771 common shares, par value $0.01, of the Company (“Options”) pursuant to the terms and conditions of this Agreement and the Company’s 2011 Management Equity Incentive Plan (the “Plan”).

WHEREAS, the Board or its duly authorized designee has determined that it would be to the advantage, and in the best interest, of the Company and its shareholders to grant the Options provided for herein to the Grantee as an incentive for increased efforts during employment with the Company or one of its Subsidiaries.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. GRANT OF Options AWARD

(a) Grant.  Subject to the terms and conditions of the Plan and this Agreement, the Company has granted to the Grantee Options for 18,771 shares, which will be earned based on the vesting provision of Section 2(a).

(b) Plan.  The foregoing award was granted under the Plan, which is incorporated herein by this reference and made a part of this Agreement.

(c) No Rights as Stockholder.  It shall be understood that none of the terms contained any such rights unless and until such Grantee receives Shares in connection with the exercise of Options.

2. RIGHT TO EXERCISE; VESTING

(a) Vesting.  Subject to the provisions of this Agreement, the Options granted hereunder shall vest as of the earlier of: (a) December 31, 2018, provided however that Grantee is

employed by the Company or one of its subsidiaries as of that date, or (b) the Termination Date (as hereinafter defined) but only if the Termination Event is either (i) a termination without Cause, or (ii) a resignation with Good Reason.

(b) Effect of Vesting.  For each vested Option the Grantee may exercise such Option for one share.

3. Exercise Procedures

(a) Notice of Exercise.  The Grantee may exercise its Options prior to their expiration as set forth in Section 6 to the extent they are vested by giving written notice to the Company in form and substance reasonably satisfactory to the Company (such notice, a “Notice of Exercise”) specifying the election to exercise such Options, the number of vested Options which are being exercised and the form of payment.  The Notice of Exercise shall be signed by the Grantee.  The Grantee shall deliver to the Company, at the time of giving the notice, payment in a form permissible under Section 4 for the full amount of the Exercise Price and, if such person is not then party to the Stockholders Agreement, such person shall be required to execute a Joinder Agreement.

(b) Issuance of Shares.  After receiving a properly completed and executed Notice of Exercise and payment for the full amount of the Exercise Price as required by Section 3(a) and, if applicable, an executed Joinder Agreement, the Company shall cause to be issued a certificate or certificates for the Purchased Shares (as defined below), registered in the name of the Grantee (or in the names of such person and his spouse as community property or as joint tenants with right of survivorship), provided that as a condition to the issuance of Purchased Shares hereunder, the Grantee shall make, as of the time of issuance of such Purchased Shares, representations and warranties in a form satisfactory to the Company and substantially similar to those contained in Exhibit A.  In connection with any exercise of these Options, the Person exercising these Options shall deliver to the Company a duly executed blank share power in the form attached hereto as Exhibit B.  The date of the issuance of the Purchased Shares by the Company to the Grantee, the “Exercise Date”.

(c) Withholding Requirements.  The Company may withhold any tax (or other governmental obligation) required to be withheld in connection with the exercise of the Options, and as a condition to the settlement of any exercise of the Options.  Such withholding may be made from any source (including any salary or other compensation payable to the Grantee), and the Grantee shall make arrangements satisfactory to the Company to enable it to satisfy all such withholding requirements as a condition to the exercise of the Options (including by remitting to the Company an amount in cash sufficient to satisfy the withholding obligation).  For the avoidance of doubt, the Company will not withhold any amounts greater than the statutory minimum.

4. payment of EXERCISE price

(a) Cash or Check.  In connection with an exercise of the Options, all or part of the Exercise Price may be paid in cash or by check.

(b) Net Exercise.  Notwithstanding anything in this Agreement to the contrary, in connection with an exercise of the Options, all or part of the Exercise Price may be paid by reducing the number of Shares being purchased pursuant to such exercise by the number of such Shares having a Fair Market Value equal to the Exercise Price.

(c) Other Methods of Payment for Shares.  At the sole discretion of the Board, and subject to applicable law, all or any part of the Exercise Price and any applicable withholding requirements may be paid by any other method permissible at the time under the terms of the Plan.

5. SECURITIES LAW ISSUES, TRANSFER restrictionS

(a) Grantee Acknowledgements and Representations.  The Grantee understands and agrees that:  (i) the Options have not been registered under the Securities Act, (ii) the Options are restricted securities under the Securities Act and (iii) the Options may not be resold or transferred unless they are first registered under the Securities Act or unless an exemption from such registration is available.  The Grantee hereby makes the representations and warranties set forth in Exhibit A hereto.

(b) No Registration Rights.  The Company may, but shall not be obligated to, register or qualify the issuance of Purchased Shares to the Grantee, or the resale of any such Purchased Shares by the Grantee under the Securities Act or any other applicable law. 

(c) Transfers.  No Option shall be transferable to any Person for any reason. Any attempt to Transfer any Option shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer.  Any Purchased Shares shall be subject to the restrictions on Transfer as set forth in Article 3 of the Stockholders Agreement, except with respect to a Transfer by will or by the laws of descent and distribution.  Unless otherwise permitted pursuant to the Stockholders Agreement, the Grantee shall not Transfer any Purchased Shares (i) except in compliance with the provisions of Article 3 of the Stockholders Agreement, and (ii) unless the transferee shall have agreed in writing to be bound by the terms of this Agreement in a manner acceptable to the Board and otherwise acknowledging that such Purchased Shares are subject to the restrictions set forth in this Agreement.  Any attempt to Transfer any Purchased Shares not in compliance with this Agreement shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer. The Grantee acknowledges that the transfer restrictions contained in this Agreement are reasonable and in the best interests of the Company.

6. TERM of Grant.

Subject to the provisions of Section 2(a), the Options subject to in this Agreement shall expire on the tenth anniversary following the date of this Agreement, except in (a) the case of death or Disability, in which case the Options subject to this Agreement terminate on the first anniversary of the date of death or Disability, and (b) the case of Grantees who have not been employed at

least five years as of the date of a Termination Event, as defined below, in which case the Options subject to this Agreement terminate on the Termination Date, also defined below. 

7. Right of Repurchase upon TERMINATION OF EMPLOYMENT 

(a) Repurchase Rights.

1. Upon the termination of employment of the Grantee by the Company or any of its Subsidiaries for any reason (the reason for the termination of such employment, the “Termination Event” and the date of such termination, the “Termination Date”), subject to the provisions of this Section 7 and the prior approval of the Compensation Committee of the Board (or if there is no such Compensation Committee, the Board), the Company shall have the right (but not the obligation) to purchase, and if such right is exercised, the Grantee shall sell, and shall cause any Permitted Transferees of the Grantee to sell (and such Permitted Transferees shall sell), to the Company, all or any portion (as determined by the Company) of the Purchased Shares (if any) owned by the Grantee or his Permitted Transferees at a price per Purchased Share equal to an amount (the “Termination Price”) (as determined pursuant to Section 7(b) below); provided,  that the parties acknowledge that any unvested Options held by the Grantee as of the Termination Date shall be cancelled pursuant to this Agreement.

2. With respect to the Purchased Shares, the Company shall notify the Grantee in writing, within the Call Period whether the Company will exercise its right to purchase the Purchased Shares (the date on which the Grantee is so notified, the “Call Notice Date”). 

3. The closing of the purchase by the Company of Purchased Shares pursuant to this Section 7 shall take place at the principal office of the Company, on the date chosen by the Company, which date shall, except as may be reasonably necessary to determine the Termination Price, in no event be more than 45 days after the Call Notice Date.  At such closing, (A) the Company shall pay the Grantee and/or such Grantee’s Permitted Transferees, as applicable, against delivery of duly endorsed certificates described below representing such Purchased Shares, the aggregate Termination Price by wire transfer of immediately available federal funds and (B) the Grantee and/or such Grantee’s Permitted Transferees, as applicable, shall deliver to the Company a certificate or certificates representing the Purchased Shares to be purchased by the Company, duly endorsed, or with share (or equivalent) powers duly endorsed, for transfer with signature guaranteed, free and clear of any lien or encumbrance, with any necessary share (or equivalent) transfer tax stamps affixed. The delivery of a certificate or certificates for the Purchased Shares by any Person selling such Purchased Shares pursuant to this Section 7(a)(iii) shall be deemed a representation and warranty by such Person that: (w)

such Person has full right, title and interest in and to such Purchased Shares; (x) such Person has all necessary power and authority and has taken all necessary action to sell such Purchased Shares as contemplated; (y) such Purchased Shares are free and clear of any and all liens or encumbrances; and (z) there is no adverse claim with respect to such Purchased Shares.

(b) Termination Pricing.  The Termination Price of any Purchased Share shall be determined as follows:

1. If the Termination Event was a resignation by the Grantee with Good Reason or termination of the employment of the Grantee by the Company or any of its Subsidiaries without Cause, the Termination Price for such Purchased Share shall be the Fair Market Value on the FMV Calculation Date,

2. if the Termination Event was as a result of the death or Disability of the Grantee, the Termination Price for such Purchased Share shall be the Fair Market Value on the Termination Date, and 

3. if the Termination Event was a termination of the employment of the Grantee by the Company or any of its Subsidiaries with Cause, or was a resignation by the Grantee without Good Reason, the Termination Price for such Purchased Share shall be the lower of (A) the Fair Market Value on the FMV Calculation Date or (B) the Exercise Price per Share.

(c) Payment Terms.  In the event that the Company exercises a Right of Repurchase pursuant to Section 7 of this Agreement, the Company shall pay the Termination Price in cash; provided,  however, that if the Company is at the time of the Purchase Closing prohibited from purchasing all or any portion of such Purchased Shares (i) because restrictive covenants or other provisions contained in the documents evidencing such entity’s or any of its Affiliates’ indebtedness for borrowed money do not permit or allow such entity to make such payments in cash in whole or in part; (ii) pursuant to applicable law; or (iii) that the Grantee was terminated for Cause, resigned without Good Reason, or if the Grantee was not employed by the Company or one of its Subsidiaries for at least five years prior to the termination for Cause or resignation without Good Reason , then, the Termination Price may be paid by the execution and delivery by the Company of a promissory note or other deferred cash payment arrangement (if applicable, any promissory note to be subordinated to the indebtedness for borrowed money of such company or any of its Affiliates) bearing interest at the prime rate, as published in the Wall Street Journal, Eastern edition, on the first Business Day immediately prior to the day on which such promissory note or other deferred cash payment is issued, with principal and accrued interest payable at such time as is required in the Board’s determination to ensure that any payment pursuant to such promissory note or other deferred cash payment arrangement is not prohibited because of any of the matters described in clauses (i) or (ii) of this Section 7(c) above. 

8. ADJUSTMENT OF SHARES

In the event of a Recapitalization, the terms of this Award (including, without limitation, the number and kind of Shares subject to this Award) shall be adjusted as set forth in Section 13 (a) of the Plan.  In the event that the Company is a party to a merger or consolidation, this Award shall be subject to Section 13(b) of the Plan.

9. MISCELLANEOUS PROVISIONS

(a) No Retention Rights.  Nothing in this Agreement or in the Plan shall confer upon the Grantee any right to continue in Service or interfere with or otherwise restrict in any way the rights of the Company or any Subsidiary employing the Grantee, which rights are hereby expressly reserved by the Company and any Subsidiary employing the Grantee, to terminate the Grantee’s Service at any time and for any reason, with or without Cause.

(b) Notices.  All notices, requests and other communications under this Agreement shall be in writing and shall be delivered in person (by courier or otherwise), mailed by certified or registered mail, return receipt requested,or sent by facsimile transmission, as follows:

If to the Company, to:

Community Choice Financial Inc.

7001 Post Road, Suite 200

Dublin, OH 43016

Attention:   Stock Option Administrator

If to the Grantee, to the address that he/she most recently provided to the Company,

(c) or, in each case, at such other address or fax number as such party may hereafter specify for the purpose of notices hereunder by written notice to the other party hereto.  All notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a Business Day in the place of receipt.  Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt.  Any notice, request or other written communication sent by facsimile transmission shall be confirmed by certified or registered mail, return receipt requested, posted within one Business Day, or by personal delivery, whether by courier or otherwise, made within two Business Days after the date of such facsimile transmissions; provided that such confirmation mailing or delivery shall not affect the date of receipt, which will be the date that the facsimile successfully transmitted the notice, request or other communication.

(d) Entire Agreement.  This Agreement and the Plan, together with the Stockholders Agreement and the other agreements referred to herein and therein and any schedules, exhibits and other documents referred to herein or therein, constitute the entire agreement and understanding among the parties hereto in respect of the subject matter hereof and thereof and supersede all prior and contemporaneous arrangements, agreements and

understandings, both oral and written, whether in term sheets, presentations or otherwise, among the parties hereto, or between any of them, with respect to the subject matter hereof and thereof.

(e) Amendment; Waiver.  No amendment or modification of any provision of this Agreement shall be effective unless signed in writing by or on behalf of the Company and the Grantee, except that the Company may amend or modify the Agreement without the Grantee’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement.  The failure of the Company in any instance to exercise the Right of Repurchase shall not constitute a waiver of any other repurchase rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Grantee.  No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.  Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which made or given.

(f) Assignment.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Grantee except pursuant to a Transfer in accordance with the provisions of this Agreement.

(g) Successors and Assigns; No Third Party Beneficiaries.  This Agreement shall inure to the benefit of and be binding upon the Company and the Grantee and their respective heirs, successors, legal representatives and permitted assigns.  Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Company and the Grantee, and their respective heirs, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

(h) Governing Law, Venue.  This Agreement and any matters or disputes related to, in connection with, or arising under this Agreement shall be governed by the laws of the State of Ohio, without regard to the conflicts of laws rules of such state.  Any legal action or proceeding with respect this Agreement shall be brought in the federal or state court sitting in the State of Ohio, and, by execution and delivery of this Agreement, each party hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the exclusive jurisdiction of such courts.  Each party irrevocably waives any objection which it may now or hereafter have to the laying of venue of the aforesaid actions or proceedings arising out of or in connection with this Agreement in the courts referred to in this paragraph and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(i) Waiver of Jury Trial.   The Grantee hereby irrevocably waives all right of trial by jury in any legal action or proceeding (including counterclaims) relating to or arising out of or in connection with this Agreement or any of the transactions or

relationships hereby contemplated or otherwise in connection with the enforcement of any rights or obligations hereunder.

(j) Interpretation.  Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation apply: 

i. Headings.  The division of this Agreement into Sections and other subdivisions and the insertion of headings are for convenience of reference only and do not alter the meaning of, or affect the construction or interpretation of, this Agreement.

ii. Section References.  All references in this Agreement to any “Section” are to the corresponding Section of this Agreement.

iii. Schedules/Exhibits.  Any capitalized terms used in any Schedule or Exhibit to this Agreement but are not otherwise defined therein have the meanings set forth in this Agreement.

(k) Severability.  If any provision of this Agreement is invalid, illegal, or incapable of being enforced by any law, all other provisions of this Agreement remain in full force and effect so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party.  If any provision of this Agreement is held to be invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

(l) Counterparts.  The parties may execute this Agreement in one or more counterparts, each of which constitutes an original copy of this Agreement and all of which, collectively constitute only one agreement.  The signatures of all the parties need not appear on the same counterpart.

(m) Grantee Undertaking.  The Grantee agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to carry out or effect one or more of the obligations or restrictions imposed on either the Grantee or upon the Options or any Purchased Shares pursuant to the provisions of this Agreement. 

(n) Plan; Stockholders Agreement; Counsel.  The Grantee acknowledges and understands that material definitions and provisions concerning the Options or any Purchased Shares and the Grantee’s rights and obligations with respect thereto are set forth in the Plan and the Stockholders Agreement.  The Grantee has had the opportunity to retain counsel, and has read carefully, and understands, the provisions of such documents. 

10. Definitions

“Affiliate” shall mean, with respect to any specified Person, (i) any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under

common control with, such specified Person (for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise); provided,  however, that neither the Company nor any of its Subsidiaries shall be deemed an Affiliate of any of the Stockholders (and viceversa), and (ii) if such specified Person is an investment fund, any other investment fund the primary investment advisor to which is the primary investment advisor to such specified Person.

“Board” means the Board of Directors of the Company, as constituted from time to time or, if a Committee has been appointed, such Committee.

“Business Day” has the meaning ascribed to such term in the Stockholders Agreement. 

“Call Period” shall mean from the Termination Date until:

if the Termination Event is a termination of the employment for any reason other than death or Disability of the Grantee, the later of (A) the date that is 60 days after such Termination Date and (B) the date that is 190 days after the Exercise Date,

if the Termination Event is a termination of the employment of the Grantee by the Company or any of its Subsidiaries as a result of the death or Disability of the Grantee, the date that is the later of (A) 60 days after the Termination Date or (B) the date which is 60 days after the Exercise Date, or

“Cause” shall mean:

(i)Grantees’s failure or refusal to comply, on a timely basis, with any lawful direction or instruction of the Board;

(ii)Grantee’s gross negligence or willful misconduct in the performance of his/her duties as an employee of the Company;

(iii)Grantee’s commission of fraud, embezzlement, misappropriation of funds, breach of fiduciary duty or act of dishonesty against the Company;

(iv)Conviction of Grantee of a felony or entry by Grantee of a plea of nolo contendre or a plea of guilty under an indictment to a felony; or

(v)Grantee’s habitual drug addiction or intoxication.

The Company shall have the right to terminate Grantee’s employment for Cause. 

 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder. 

“Committee” means the compensation committee of the Board of Directors of the Company. 

 “Disability” means Grantee’s incapacity due to physical or mental illness such that  Grantee is unable to perform his/her duties for 180 consecutive days and, within 30 days after a notice of termination, which notice of termination may not be given until the expiration of such consecutive 180 day period, is given to Grantee, Grantee has not returned to work.    

“Exercise Price” means $1.00.

“Fair Market Value” or “FMV” with respect to a share of stock of the Company, shall mean (i) in the event that such shares are listed on an established U.S. exchange or through the NASDAQ National Market or any established over-the-counter trading system, the average of the closing prices of such Group Equity Securities on such exchange if listed or, if not so listed, the average bid and asked price of such shares reported on the NASDAQ National Market or any established over-the-counter trading system on which prices for such shares are quoted, in each case, for a period of twenty trading days prior to such date of determination, or (ii) if such shares are not publicly traded, a good faith determination by the Board through a reasonable application of a reasonable valuation method.  Such determination shall be conclusive and binding on all persons. 

“FMV Calculation Date” means:

i. if the Termination Event is a termination by the Company or any of its Subsidiaries without Cause, a resignation by the Grantee with Good Reason or a resignation by the Grantee without Good Reason after three years of Service:

ii. if the Exercise Date occurred 180 days or more before the Termination Date, the Termination Date, and

iii. if the Exercise Date occurred 179 days or less before the Termination Date or occurs after the Termination Date, then the Call Notice Date;

iv. if the Termination Event is as a result of the death or Disability of the Grantee, then the Termination Date; and

v. if the Termination Event is a termination by the Company or any of its Subsidiaries with Cause, or a resignation by the Grantee without Good Reason during the Grantee’s, then the Termination Date.

“Good Reason”  Grantee may resign for “Good Reason” within 30 days after Grantee has actual knowledge of the occurrence, without the written consent of Grantee, of one of the following events:

(i)a reduction in Grantee’s base salary, or non-timely payment of base salary or earned annual bonus not cured by the Company within five business days;  

(ii)a material diminution in Grantee’s duties or responsibilities not cured by the Company within 20 days after written notice to the Company. For the purposes of this section, a “material diminution in Grantee’s duties or responsibilities” shall not include a realignment or reorganization of executive responsibilities as the result of Company growth or contraction or the growth or contraction of the Company’s management team, but shall include the removal or withdrawal of substantially all of the Executive’s duties or responsibilities; or

(iii)Grantee’s retirement providedhowever that Grantee shall give not less than 30 days written notice thereof.

“Joinder Agreement” means an agreement substantially in the form of Exhibit A of the Stockholders Agreement, pursuant to which the Grantee shall become a party to the Stockholders Agreement and subject to all of the rights, restrictions and obligations contained therein.

“Permitted Transferee”has the meaning ascribed to such term in the Stockholders Agreement.

“Person” means an individual, corporation, limited liability company, partnership, association, trust or other entity or organization. 

“Purchased Shares” means any Shares issued pursuant to the exercise of any Option in accordance with the terms of this Agreement.

“Right of Repurchase” means the Company’s right of repurchase described in Section 7 of this Agreement.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

“Service” means service as an employee. 

“Share(s)” means common share(s) of the Company.

“Stockholders Agreement” means that certain Stockholders Agreement dated as of April 28, 2011, by and among the Company, the Grantee and the other parties thereto (as the same shall be amended, modified or supplemented from time to time).  

“Subsidiary”  means, with respect to the Company, any other Person in which the Company, directly or indirectly through one or more Affiliates or otherwise, beneficially owns at least 50% of either the ownership interest (determined by equity or economic interests) in, or the voting control of, such other Person. 

“Transfer” has the meaning ascribed in such term in the Stockholders Agreement. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

COMMUNITY CHOICE FINANCIAL INC.

By: /s/ William E. Saunders, Jr.

Name:  William E. Saunders, Jr.

Title:     Chairman/CEO

/s/ Kyle F. Hanson

Kyle F. Hanson

EXHIBIT A

to Option Award Agreement

Investment Representations and Warranties

The Grantee hereby represents and warrants to the Company that:

1. The Options and Purchased Shares received by him will be held by him for investment only for his own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee has no current intention of selling, granting participation in or otherwise distributing the Options or Purchased Shares in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity, or to any third person or entity, with respect to any of the Options or Purchased Shares, in each case, in violation of applicable U.S. federal or state or foreign securities laws.

2. The Grantee understands that although the Company has a pending S-1 Registration Statement with the U.S. Securities and Exchange Commission that as of the date of this grant, the issuance of the Options and Purchased Shares have not been registered under the Securities Act or any applicable U.S. state or foreign securities laws, and that the Options and Purchased Shares are being issued in reliance on an exemption from registration, which exemption depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Grantee’s representations as expressed herein.

3. The Grantee has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of his owning the Options and Purchased Shares.  The Grantee is a sophisticated investor, has relied upon independent investigations made by the Grantee and, to the extent believed by the Grantee to be appropriate, the Grantee’s representatives, including the Grantee’s own professional, tax and other advisors, and is making an independent decision to invest in the Options and Purchased Shares.  The Grantee has been furnished with such documents, materials and information that the Grantee deems necessary or appropriate for evaluating an investment in the Company, and the Grantee has read carefully such documents, materials and information and understands and has evaluated the types of risks involved with holding the Options and Purchased Shares.  The Grantee has not relied upon any representations or other information (whether oral or written) from the Company or its shareholders, directors, officers or affiliates, or from any other person or entity, in connection with his investment in the Options and Purchased Shares.  The Grantee acknowledges that the Company has not given any assurances with respect to the tax consequences of the ownership and disposition of the Options and Purchased Shares.

4. The Grantee has had, prior to his being granted the Options and Purchased Shares, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the transactions contemplated by the Agreement and the Grantee’s holding of the Options and Purchased Shares and to obtain additional information necessary to verify the accuracy of any information furnished to his or to which she had access.  The Grantee confirms that she has satisfied himself with respect to any of the foregoing matters.

5. The Grantee understands that no U.S. federal or state or foreign agency has passed upon the Options or Purchased Shares or upon the Company, or upon the accuracy, validity or completeness of any documentation provided to the Grantee in connection with the transactions contemplated by the Agreement, nor has any such agency made any finding or determination as to holding the Options or Purchased Shares.

6. The Grantee understands that there are substantial restrictions on the transferability of the Options and Purchased Shares and that on the date of the Agreement and for an indefinite period thereafter there will be no public market for the Options or Purchased Shares and, accordingly, it may not be possible for the Grantee to liquidate his investment in case of emergency, if at all.  In addition, the Grantee understands that the Agreement and Stockholders Agreement contain substantial restrictions on the transferability of the Options and Purchased Shares and provide that, in the event that the conditions relating to the transfer of any Options or Purchased Shares in such document has not been satisfied, the holder shall not transfer any such Options or Purchased Shares, and unless otherwise specified the Company will not recognize the transfer of any such Options or Purchased Shares on its books and records or issue any share certificates representing any such Options or Purchased Shares, and any purported transfer not in accordance with the terms of the Agreement or the Stockholders Agreement shall be void.  As such, Grantee understands that: a restrictive legend or legends in a form to be set forth in the Agreement and the Stockholders Agreement will be placed on the certificates representing the Options and Purchased Shares; a notation will be made in the appropriate records of the Company indicating that each of the Options and Purchased Shares are subject to restrictions on transfer and, if the Company should at some time in the future engage the services of a securities transfer agent, appropriate stop-transfer instructions will be issued to such transfer agent with respect to the Options and Purchased Shares; and the Grantee will sell, transfer or otherwise dispose of the Options or Purchased Shares only in a manner consistent with its representations set forth herein and then only in accordance with the Agreement and the Stockholders Agreement.

7. The Grantee understands that (i) the neither the Options nor the Purchased Shares may not be sold, transferred or otherwise disposed of without registration under the Securities Act or an exemption therefrom, (ii) the Options and Purchased Shares have not been registered under the Securities Act; (iii) the Options and Purchased Shares must be held indefinitely and she must continue to bear the economic risk of holding the Options and Purchased Shares unless such Options and Purchased Shares are subsequently registered under the Securities Act or an exemption from such registration is available; (iv) the Grantee is prepared to bear the economic risk of holding the Options and Purchased Shares for an indefinite period of time; (v) it is not anticipated that there will be any

public market for the Options or Purchased Shares; (vi) the Options and Purchased Shares are characterized as “restricted securities” under the U.S. federal securities laws; and (vii) the Options and Purchased Shares may not be sold, transferred or otherwise disposed of except in compliance with federal, state and local law.

8. The Grantee understands that an investment in the Options or Purchased Shares is not recommended for investors who have any need for a current return on this investment or who cannot bear the risk of losing their entire investment.  In that regard, the Grantee understands that his holding the Options and Purchased Shares involves a high degree of risk of loss.  The Grantee acknowledges that: (i) he/she has adequate means of providing for his current needs and possible personal contingencies and has no need for liquidity in this investment; (ii) his/her commitment to investments which are not readily marketable is not disproportionate to his net worth; and (iii) his/her holding the Options and Purchased Shares will not cause his overall financial commitments to become excessive. 

EXHIBIT B

to Option Award Agreement

Share Power

IRREVOCABLE STOCK POWERS

COMMUNITY CHOICE FINANCIAL INC.

FOR VALUE RECEIVED, Kyle F. Hanson, does hereby sell, assign and transfer unto ____________________    _______________ Common Shares of Community Choice Financial Inc., par value $0.01, represented by Certificate No. ___ herewith and does hereby irrevocably constitute and appoint ______________________ attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises.   

Dated:  _________________

By: William E. Saunders, Jr

William E. Saunders, Jr.

EX-10.43

Exhibit 10.43

Community Choice Financial Inc.

2011 Management Equity Incentive Plan

Option Award Agreement

GRANT TO:  Michael J. Durbin

THIS AGREEMENT (the “Agreement”) is made as of January 1, 2018, between Community Choice Financial Inc., an Ohio corporation (together with its successors, the “Company”), and Michael J. Durbin, who is an employee of the Company or one of its Subsidiaries (the “Grantee”).  Capitalized terms, unless defined in this Agreement, shall have the same meanings as in the Plan (as defined below). 

WHEREAS, in connection with the Grantee’s employment with the Company or one of its Subsidiaries, the Company granted to the Grantee as of January 1, 2018 (the “Grant Date”) an option to purchase 17,831 common shares, par value $0.01, of the Company (“Options”) pursuant to the terms and conditions of this Agreement and the Company’s 2011 Management Equity Incentive Plan (the “Plan”).

WHEREAS, the Board or its duly authorized designee has determined that it would be to the advantage, and in the best interest, of the Company and its shareholders to grant the Options provided for herein to the Grantee as an incentive for increased efforts during employment with the Company or one of its Subsidiaries.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. GRANT OF Options AWARD

(a) Grant.  Subject to the terms and conditions of the Plan and this Agreement, the Company has granted to the Grantee Options for 17,831 shares, which will be earned based on the vesting provision of Section 2(a).

(b) Plan.  The foregoing award was granted under the Plan, which is incorporated herein by this reference and made a part of this Agreement.

(c) No Rights as Stockholder.  It shall be understood that none of the terms contained any such rights unless and until such Grantee receives Shares in connection with the exercise of Options.

2. RIGHT TO EXERCISE; VESTING

(a) Vesting.  Subject to the provisions of this Agreement, the Options granted hereunder shall vest as of the earlier of: (a) December 31, 2018, provided however that Grantee is

employed by the Company or one of its subsidiaries as of that date, or (b) the Termination Date (as hereinafter defined) but only if the Termination Event is either (i) a termination without Cause, or (ii) a resignation with Good Reason.

(b) Effect of Vesting.  For each vested Option the Grantee may exercise such Option for one share.

3. Exercise Procedures

(a) Notice of Exercise.  The Grantee may exercise its Options prior to their expiration as set forth in Section 6 to the extent they are vested by giving written notice to the Company in form and substance reasonably satisfactory to the Company (such notice, a “Notice of Exercise”) specifying the election to exercise such Options, the number of vested Options which are being exercised and the form of payment.  The Notice of Exercise shall be signed by the Grantee.  The Grantee shall deliver to the Company, at the time of giving the notice, payment in a form permissible under Section 4 for the full amount of the Exercise Price and, if such person is not then party to the Stockholders Agreement, such person shall be required to execute a Joinder Agreement.

(b) Issuance of Shares.  After receiving a properly completed and executed Notice of Exercise and payment for the full amount of the Exercise Price as required by Section 3(a) and, if applicable, an executed Joinder Agreement, the Company shall cause to be issued a certificate or certificates for the Purchased Shares (as defined below), registered in the name of the Grantee (or in the names of such person and his spouse as community property or as joint tenants with right of survivorship), provided that as a condition to the issuance of Purchased Shares hereunder, the Grantee shall make, as of the time of issuance of such Purchased Shares, representations and warranties in a form satisfactory to the Company and substantially similar to those contained in Exhibit A.  In connection with any exercise of these Options, the Person exercising these Options shall deliver to the Company a duly executed blank share power in the form attached hereto as Exhibit B.  The date of the issuance of the Purchased Shares by the Company to the Grantee, the “Exercise Date”.

(c) Withholding Requirements.  The Company may withhold any tax (or other governmental obligation) required to be withheld in connection with the exercise of the Options, and as a condition to the settlement of any exercise of the Options.  Such withholding may be made from any source (including any salary or other compensation payable to the Grantee), and the Grantee shall make arrangements satisfactory to the Company to enable it to satisfy all such withholding requirements as a condition to the exercise of the Options (including by remitting to the Company an amount in cash sufficient to satisfy the withholding obligation).  For the avoidance of doubt, the Company will not withhold any amounts greater than the statutory minimum.

4. payment of EXERCISE price

(a) Cash or Check.  In connection with an exercise of the Options, all or part of the Exercise Price may be paid in cash or by check.

(b) Net Exercise.  Notwithstanding anything in this Agreement to the contrary, in connection with an exercise of the Options, all or part of the Exercise Price may be paid by reducing the number of Shares being purchased pursuant to such exercise by the number of such Shares having a Fair Market Value equal to the Exercise Price.

(c) Other Methods of Payment for Shares.  At the sole discretion of the Board, and subject to applicable law, all or any part of the Exercise Price and any applicable withholding requirements may be paid by any other method permissible at the time under the terms of the Plan.

5. SECURITIES LAW ISSUES, TRANSFER restrictionS

(a) Grantee Acknowledgements and Representations.  The Grantee understands and agrees that:  (i) the Options have not been registered under the Securities Act, (ii) the Options are restricted securities under the Securities Act and (iii) the Options may not be resold or transferred unless they are first registered under the Securities Act or unless an exemption from such registration is available.  The Grantee hereby makes the representations and warranties set forth in Exhibit A hereto.

(b) No Registration Rights.  The Company may, but shall not be obligated to, register or qualify the issuance of Purchased Shares to the Grantee, or the resale of any such Purchased Shares by the Grantee under the Securities Act or any other applicable law. 

(c) Transfers.  No Option shall be transferable to any Person for any reason. Any attempt to Transfer any Option shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer.  Any Purchased Shares shall be subject to the restrictions on Transfer as set forth in Article 3 of the Stockholders Agreement, except with respect to a Transfer by will or by the laws of descent and distribution.  Unless otherwise permitted pursuant to the Stockholders Agreement, the Grantee shall not Transfer any Purchased Shares (i) except in compliance with the provisions of Article 3 of the Stockholders Agreement, and (ii) unless the transferee shall have agreed in writing to be bound by the terms of this Agreement in a manner acceptable to the Board and otherwise acknowledging that such Purchased Shares are subject to the restrictions set forth in this Agreement.  Any attempt to Transfer any Purchased Shares not in compliance with this Agreement shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer. The Grantee acknowledges that the transfer restrictions contained in this Agreement are reasonable and in the best interests of the Company.

6. TERM of Grant.

Subject to the provisions of Section 2(a), the Options subject to in this Agreement shall expire on the tenth anniversary following the date of this Agreement, except in (a) the case of death or Disability, in which case the Options subject to this Agreement terminate on the first anniversary of the date of death or Disability, and (b) the case of Grantees who have not been employed at

least five years as of the date of a Termination Event, as defined below, in which case the Options subject to this Agreement terminate on the Termination Date, also defined below. 

7. Right of Repurchase upon TERMINATION OF EMPLOYMENT 

(a) Repurchase Rights.

1. Upon the termination of employment of the Grantee by the Company or any of its Subsidiaries for any reason (the reason for the termination of such employment, the “Termination Event” and the date of such termination, the “Termination Date”), subject to the provisions of this Section 7 and the prior approval of the Compensation Committee of the Board (or if there is no such Compensation Committee, the Board), the Company shall have the right (but not the obligation) to purchase, and if such right is exercised, the Grantee shall sell, and shall cause any Permitted Transferees of the Grantee to sell (and such Permitted Transferees shall sell), to the Company, all or any portion (as determined by the Company) of the Purchased Shares (if any) owned by the Grantee or his Permitted Transferees at a price per Purchased Share equal to an amount (the “Termination Price”) (as determined pursuant to Section 7(b) below); provided,  that the parties acknowledge that any unvested Options held by the Grantee as of the Termination Date shall be cancelled pursuant to this Agreement.

2. With respect to the Purchased Shares, the Company shall notify the Grantee in writing, within the Call Period whether the Company will exercise its right to purchase the Purchased Shares (the date on which the Grantee is so notified, the “Call Notice Date”). 

3. The closing of the purchase by the Company of Purchased Shares pursuant to this Section 7 shall take place at the principal office of the Company, on the date chosen by the Company, which date shall, except as may be reasonably necessary to determine the Termination Price, in no event be more than 45 days after the Call Notice Date.  At such closing, (A) the Company shall pay the Grantee and/or such Grantee’s Permitted Transferees, as applicable, against delivery of duly endorsed certificates described below representing such Purchased Shares, the aggregate Termination Price by wire transfer of immediately available federal funds and (B) the Grantee and/or such Grantee’s Permitted Transferees, as applicable, shall deliver to the Company a certificate or certificates representing the Purchased Shares to be purchased by the Company, duly endorsed, or with share (or equivalent) powers duly endorsed, for transfer with signature guaranteed, free and clear of any lien or encumbrance, with any necessary share (or equivalent) transfer tax stamps affixed. The delivery of a certificate or certificates for the Purchased Shares by any Person selling such Purchased Shares pursuant to this Section 7(a)(iii) shall be deemed a representation and warranty by such Person that: (w)

such Person has full right, title and interest in and to such Purchased Shares; (x) such Person has all necessary power and authority and has taken all necessary action to sell such Purchased Shares as contemplated; (y) such Purchased Shares are free and clear of any and all liens or encumbrances; and (z) there is no adverse claim with respect to such Purchased Shares.

(b) Termination Pricing.  The Termination Price of any Purchased Share shall be determined as follows:

1. If the Termination Event was a resignation by the Grantee with Good Reason or termination of the employment of the Grantee by the Company or any of its Subsidiaries without Cause, the Termination Price for such Purchased Share shall be the Fair Market Value on the FMV Calculation Date,

2. if the Termination Event was as a result of the death or Disability of the Grantee, the Termination Price for such Purchased Share shall be the Fair Market Value on the Termination Date, and 

3. if the Termination Event was a termination of the employment of the Grantee by the Company or any of its Subsidiaries with Cause, or was a resignation by the Grantee without Good Reason, the Termination Price for such Purchased Share shall be the lower of (A) the Fair Market Value on the FMV Calculation Date or (B) the Exercise Price per Share.

(c) Payment Terms.  In the event that the Company exercises a Right of Repurchase pursuant to Section 7 of this Agreement, the Company shall pay the Termination Price in cash; provided,  however, that if the Company is at the time of the Purchase Closing prohibited from purchasing all or any portion of such Purchased Shares (i) because restrictive covenants or other provisions contained in the documents evidencing such entity’s or any of its Affiliates’ indebtedness for borrowed money do not permit or allow such entity to make such payments in cash in whole or in part; (ii) pursuant to applicable law; or (iii) that the Grantee was terminated for Cause, resigned without Good Reason, or if the Grantee was not employed by the Company or one of its Subsidiaries for at least five years prior to the termination for Cause or resignation without Good Reason , then, the Termination Price may be paid by the execution and delivery by the Company of a promissory note or other deferred cash payment arrangement (if applicable, any promissory note to be subordinated to the indebtedness for borrowed money of such company or any of its Affiliates) bearing interest at the prime rate, as published in the Wall Street Journal, Eastern edition, on the first Business Day immediately prior to the day on which such promissory note or other deferred cash payment is issued, with principal and accrued interest payable at such time as is required in the Board’s determination to ensure that any payment pursuant to such promissory note or other deferred cash payment arrangement is not prohibited because of any of the matters described in clauses (i) or (ii) of this Section 7(c) above. 

8. ADJUSTMENT OF SHARES

In the event of a Recapitalization, the terms of this Award (including, without limitation, the number and kind of Shares subject to this Award) shall be adjusted as set forth in Section 13 (a) of the Plan.  In the event that the Company is a party to a merger or consolidation, this Award shall be subject to Section 13(b) of the Plan.

9. MISCELLANEOUS PROVISIONS

(a) No Retention Rights.  Nothing in this Agreement or in the Plan shall confer upon the Grantee any right to continue in Service or interfere with or otherwise restrict in any way the rights of the Company or any Subsidiary employing the Grantee, which rights are hereby expressly reserved by the Company and any Subsidiary employing the Grantee, to terminate the Grantee’s Service at any time and for any reason, with or without Cause.

(b) Notices.  All notices, requests and other communications under this Agreement shall be in writing and shall be delivered in person (by courier or otherwise), mailed by certified or registered mail, return receipt requested,or sent by facsimile transmission, as follows:

If to the Company, to:

Community Choice Financial Inc.

7001 Post Road, Suite 200

Dublin, OH 43016

Attention:   Stock Option Administrator

If to the Grantee, to the address that he/she most recently provided to the Company,

(c) or, in each case, at such other address or fax number as such party may hereafter specify for the purpose of notices hereunder by written notice to the other party hereto.  All notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a Business Day in the place of receipt.  Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt.  Any notice, request or other written communication sent by facsimile transmission shall be confirmed by certified or registered mail, return receipt requested, posted within one Business Day, or by personal delivery, whether by courier or otherwise, made within two Business Days after the date of such facsimile transmissions; provided that such confirmation mailing or delivery shall not affect the date of receipt, which will be the date that the facsimile successfully transmitted the notice, request or other communication.

(d) Entire Agreement.  This Agreement and the Plan, together with the Stockholders Agreement and the other agreements referred to herein and therein and any schedules, exhibits and other documents referred to herein or therein, constitute the entire agreement and understanding among the parties hereto in respect of the subject matter hereof and thereof and supersede all prior and contemporaneous arrangements, agreements and

understandings, both oral and written, whether in term sheets, presentations or otherwise, among the parties hereto, or between any of them, with respect to the subject matter hereof and thereof.

(e) Amendment; Waiver.  No amendment or modification of any provision of this Agreement shall be effective unless signed in writing by or on behalf of the Company and the Grantee, except that the Company may amend or modify the Agreement without the Grantee’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement.  The failure of the Company in any instance to exercise the Right of Repurchase shall not constitute a waiver of any other repurchase rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Grantee.  No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.  Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which made or given.

(f) Assignment.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Grantee except pursuant to a Transfer in accordance with the provisions of this Agreement.

(g) Successors and Assigns; No Third Party Beneficiaries.  This Agreement shall inure to the benefit of and be binding upon the Company and the Grantee and their respective heirs, successors, legal representatives and permitted assigns.  Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Company and the Grantee, and their respective heirs, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

(h) Governing Law, Venue.  This Agreement and any matters or disputes related to, in connection with, or arising under this Agreement shall be governed by the laws of the State of Ohio, without regard to the conflicts of laws rules of such state.  Any legal action or proceeding with respect this Agreement shall be brought in the federal or state court sitting in the State of Ohio, and, by execution and delivery of this Agreement, each party hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the exclusive jurisdiction of such courts.  Each party irrevocably waives any objection which it may now or hereafter have to the laying of venue of the aforesaid actions or proceedings arising out of or in connection with this Agreement in the courts referred to in this paragraph and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(i) Waiver of Jury Trial.   The Grantee hereby irrevocably waives all right of trial by jury in any legal action or proceeding (including counterclaims) relating to or arising out of or in connection with this Agreement or any of the transactions or

relationships hereby contemplated or otherwise in connection with the enforcement of any rights or obligations hereunder.

(j) Interpretation.  Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation apply: 

i. Headings.  The division of this Agreement into Sections and other subdivisions and the insertion of headings are for convenience of reference only and do not alter the meaning of, or affect the construction or interpretation of, this Agreement.

ii. Section References.  All references in this Agreement to any “Section” are to the corresponding Section of this Agreement.

iii. Schedules/Exhibits.  Any capitalized terms used in any Schedule or Exhibit to this Agreement but are not otherwise defined therein have the meanings set forth in this Agreement.

(k) Severability.  If any provision of this Agreement is invalid, illegal, or incapable of being enforced by any law, all other provisions of this Agreement remain in full force and effect so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party.  If any provision of this Agreement is held to be invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

(l) Counterparts.  The parties may execute this Agreement in one or more counterparts, each of which constitutes an original copy of this Agreement and all of which, collectively constitute only one agreement.  The signatures of all the parties need not appear on the same counterpart.

(m) Grantee Undertaking.  The Grantee agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to carry out or effect one or more of the obligations or restrictions imposed on either the Grantee or upon the Options or any Purchased Shares pursuant to the provisions of this Agreement. 

(n) Plan; Stockholders Agreement; Counsel.  The Grantee acknowledges and understands that material definitions and provisions concerning the Options or any Purchased Shares and the Grantee’s rights and obligations with respect thereto are set forth in the Plan and the Stockholders Agreement.  The Grantee has had the opportunity to retain counsel, and has read carefully, and understands, the provisions of such documents. 

10. Definitions

“Affiliate” shall mean, with respect to any specified Person, (i) any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under

common control with, such specified Person (for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise); provided,  however, that neither the Company nor any of its Subsidiaries shall be deemed an Affiliate of any of the Stockholders (and viceversa), and (ii) if such specified Person is an investment fund, any other investment fund the primary investment advisor to which is the primary investment advisor to such specified Person.

“Board” means the Board of Directors of the Company, as constituted from time to time or, if a Committee has been appointed, such Committee.

“Business Day” has the meaning ascribed to such term in the Stockholders Agreement. 

“Call Period” shall mean from the Termination Date until:

if the Termination Event is a termination of the employment for any reason other than death or Disability of the Grantee, the later of (A) the date that is 60 days after such Termination Date and (B) the date that is 190 days after the Exercise Date,

if the Termination Event is a termination of the employment of the Grantee by the Company or any of its Subsidiaries as a result of the death or Disability of the Grantee, the date that is the later of (A) 60 days after the Termination Date or (B) the date which is 60 days after the Exercise Date, or

“Cause” shall mean:

(i)Grantees’s failure or refusal to comply, on a timely basis, with any lawful direction or instruction of the Board;

(ii)Grantee’s gross negligence or willful misconduct in the performance of his/her duties as an employee of the Company;

(iii)Grantee’s commission of fraud, embezzlement, misappropriation of funds, breach of fiduciary duty or act of dishonesty against the Company;

(iv)Conviction of Grantee of a felony or entry by Grantee of a plea of nolo contendre or a plea of guilty under an indictment to a felony; or

(v)Grantee’s habitual drug addiction or intoxication.

The Company shall have the right to terminate Grantee’s employment for Cause. 

 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder. 

“Committee” means the compensation committee of the Board of Directors of the Company. 

 “Disability” means Grantee’s incapacity due to physical or mental illness such that  Grantee is unable to perform his/her duties for 180 consecutive days and, within 30 days after a notice of termination, which notice of termination may not be given until the expiration of such consecutive 180 day period, is given to Grantee, Grantee has not returned to work.    

“Exercise Price” means $1.00.

“Fair Market Value” or “FMV” with respect to a share of stock of the Company, shall mean (i) in the event that such shares are listed on an established U.S. exchange or through the NASDAQ National Market or any established over-the-counter trading system, the average of the closing prices of such Group Equity Securities on such exchange if listed or, if not so listed, the average bid and asked price of such shares reported on the NASDAQ National Market or any established over-the-counter trading system on which prices for such shares are quoted, in each case, for a period of twenty trading days prior to such date of determination, or (ii) if such shares are not publicly traded, a good faith determination by the Board through a reasonable application of a reasonable valuation method.  Such determination shall be conclusive and binding on all persons. 

“FMV Calculation Date” means:

i. if the Termination Event is a termination by the Company or any of its Subsidiaries without Cause, a resignation by the Grantee with Good Reason or a resignation by the Grantee without Good Reason after three years of Service:

ii. if the Exercise Date occurred 180 days or more before the Termination Date, the Termination Date, and

iii. if the Exercise Date occurred 179 days or less before the Termination Date or occurs after the Termination Date, then the Call Notice Date;

iv. if the Termination Event is as a result of the death or Disability of the Grantee, then the Termination Date; and

v. if the Termination Event is a termination by the Company or any of its Subsidiaries with Cause, or a resignation by the Grantee without Good Reason during the Grantee’s, then the Termination Date.

“Good Reason”  Grantee may resign for “Good Reason” within 30 days after Grantee has actual knowledge of the occurrence, without the written consent of Grantee, of one of the following events:

(i)a reduction in Grantee’s base salary, or non-timely payment of base salary or earned annual bonus not cured by the Company within five business days;  

(ii)a material diminution in Grantee’s duties or responsibilities not cured by the Company within 20 days after written notice to the Company. For the purposes of this section, a “material diminution in Grantee’s duties or responsibilities” shall not include a realignment or reorganization of executive responsibilities as the result of Company growth or contraction or the growth or contraction of the Company’s management team, but shall include the removal or withdrawal of substantially all of the Executive’s duties or responsibilities; or

(iii)Grantee’s retirement providedhowever that Grantee shall give not less than 30 days written notice thereof.

“Joinder Agreement” means an agreement substantially in the form of Exhibit A of the Stockholders Agreement, pursuant to which the Grantee shall become a party to the Stockholders Agreement and subject to all of the rights, restrictions and obligations contained therein.

“Permitted Transferee”has the meaning ascribed to such term in the Stockholders Agreement.

“Person” means an individual, corporation, limited liability company, partnership, association, trust or other entity or organization. 

“Purchased Shares” means any Shares issued pursuant to the exercise of any Option in accordance with the terms of this Agreement.

“Right of Repurchase” means the Company’s right of repurchase described in Section 7 of this Agreement.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

“Service” means service as an employee. 

“Share(s)” means common share(s) of the Company.

“Stockholders Agreement” means that certain Stockholders Agreement dated as of April 28, 2011, by and among the Company, the Grantee and the other parties thereto (as the same shall be amended, modified or supplemented from time to time).  

“Subsidiary”  means, with respect to the Company, any other Person in which the Company, directly or indirectly through one or more Affiliates or otherwise, beneficially owns at least 50% of either the ownership interest (determined by equity or economic interests) in, or the voting control of, such other Person. 

“Transfer” has the meaning ascribed in such term in the Stockholders Agreement. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

COMMUNITY CHOICE FINANCIAL INC.

By: /s/ William E. Saunders, Jr.

Name:  William E. Saunders, Jr.

Title:     Chairman/CEO

/s/ Michael J. Durbin

Michael J. Durbin

EXHIBIT A

to Option Award Agreement

Investment Representations and Warranties

The Grantee hereby represents and warrants to the Company that:

1. The Options and Purchased Shares received by him will be held by him for investment only for his own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee has no current intention of selling, granting participation in or otherwise distributing the Options or Purchased Shares in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity, or to any third person or entity, with respect to any of the Options or Purchased Shares, in each case, in violation of applicable U.S. federal or state or foreign securities laws.

2. The Grantee understands that although the Company has a pending S-1 Registration Statement with the U.S. Securities and Exchange Commission that as of the date of this grant, the issuance of the Options and Purchased Shares have not been registered under the Securities Act or any applicable U.S. state or foreign securities laws, and that the Options and Purchased Shares are being issued in reliance on an exemption from registration, which exemption depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Grantee’s representations as expressed herein.

3. The Grantee has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of his owning the Options and Purchased Shares.  The Grantee is a sophisticated investor, has relied upon independent investigations made by the Grantee and, to the extent believed by the Grantee to be appropriate, the Grantee’s representatives, including the Grantee’s own professional, tax and other advisors, and is making an independent decision to invest in the Options and Purchased Shares.  The Grantee has been furnished with such documents, materials and information that the Grantee deems necessary or appropriate for evaluating an investment in the Company, and the Grantee has read carefully such documents, materials and information and understands and has evaluated the types of risks involved with holding the Options and Purchased Shares.  The Grantee has not relied upon any representations or other information (whether oral or written) from the Company or its shareholders, directors, officers or affiliates, or from any other person or entity, in connection with his investment in the Options and Purchased Shares.  The Grantee acknowledges that the Company has not given any assurances with respect to the tax consequences of the ownership and disposition of the Options and Purchased Shares.

4. The Grantee has had, prior to his being granted the Options and Purchased Shares, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the transactions contemplated by the Agreement and the Grantee’s holding of the Options and Purchased Shares and to obtain additional information necessary to verify the accuracy of any information furnished to his or to which she had access.  The Grantee confirms that she has satisfied himself with respect to any of the foregoing matters.

5. The Grantee understands that no U.S. federal or state or foreign agency has passed upon the Options or Purchased Shares or upon the Company, or upon the accuracy, validity or completeness of any documentation provided to the Grantee in connection with the transactions contemplated by the Agreement, nor has any such agency made any finding or determination as to holding the Options or Purchased Shares.

6. The Grantee understands that there are substantial restrictions on the transferability of the Options and Purchased Shares and that on the date of the Agreement and for an indefinite period thereafter there will be no public market for the Options or Purchased Shares and, accordingly, it may not be possible for the Grantee to liquidate his investment in case of emergency, if at all.  In addition, the Grantee understands that the Agreement and Stockholders Agreement contain substantial restrictions on the transferability of the Options and Purchased Shares and provide that, in the event that the conditions relating to the transfer of any Options or Purchased Shares in such document has not been satisfied, the holder shall not transfer any such Options or Purchased Shares, and unless otherwise specified the Company will not recognize the transfer of any such Options or Purchased Shares on its books and records or issue any share certificates representing any such Options or Purchased Shares, and any purported transfer not in accordance with the terms of the Agreement or the Stockholders Agreement shall be void.  As such, Grantee understands that: a restrictive legend or legends in a form to be set forth in the Agreement and the Stockholders Agreement will be placed on the certificates representing the Options and Purchased Shares; a notation will be made in the appropriate records of the Company indicating that each of the Options and Purchased Shares are subject to restrictions on transfer and, if the Company should at some time in the future engage the services of a securities transfer agent, appropriate stop-transfer instructions will be issued to such transfer agent with respect to the Options and Purchased Shares; and the Grantee will sell, transfer or otherwise dispose of the Options or Purchased Shares only in a manner consistent with its representations set forth herein and then only in accordance with the Agreement and the Stockholders Agreement.

7. The Grantee understands that (i) the neither the Options nor the Purchased Shares may not be sold, transferred or otherwise disposed of without registration under the Securities Act or an exemption therefrom, (ii) the Options and Purchased Shares have not been registered under the Securities Act; (iii) the Options and Purchased Shares must be held indefinitely and she must continue to bear the economic risk of holding the Options and Purchased Shares unless such Options and Purchased Shares are subsequently registered under the Securities Act or an exemption from such registration is available; (iv) the Grantee is prepared to bear the economic risk of holding the Options and Purchased Shares for an indefinite period of time; (v) it is not anticipated that there will be any

public market for the Options or Purchased Shares; (vi) the Options and Purchased Shares are characterized as “restricted securities” under the U.S. federal securities laws; and (vii) the Options and Purchased Shares may not be sold, transferred or otherwise disposed of except in compliance with federal, state and local law.

8. The Grantee understands that an investment in the Options or Purchased Shares is not recommended for investors who have any need for a current return on this investment or who cannot bear the risk of losing their entire investment.  In that regard, the Grantee understands that his holding the Options and Purchased Shares involves a high degree of risk of loss.  The Grantee acknowledges that: (i) he/she has adequate means of providing for his current needs and possible personal contingencies and has no need for liquidity in this investment; (ii) his/her commitment to investments which are not readily marketable is not disproportionate to his net worth; and (iii) his/her holding the Options and Purchased Shares will not cause his overall financial commitments to become excessive. 

EXHIBIT B

to Option Award Agreement

Share Power

IRREVOCABLE STOCK POWERS

COMMUNITY CHOICE FINANCIAL INC.

FOR VALUE RECEIVED, Michael J. Durbin, does hereby sell, assign and transfer unto ____________________    _______________ Common Shares of Community Choice Financial Inc., par value $0.01, represented by Certificate No. ___ herewith and does hereby irrevocably constitute and appoint ______________________ attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises.   

Dated:  _________________

By: William E. Saunders, Jr

William E. Saunders, Jr.

EX-10.44

Exhibit 10.44

Community Choice Financial Inc.

2011 Management Equity Incentive Plan

Option Award Agreement

GRANT TO:  Bridgette C. Roman

THIS AGREEMENT (the “Agreement”) is made as of January 1, 2018, between Community Choice Financial Inc., an Ohio corporation (together with its successors, the “Company”), and Bridgette C. Roman, who is an employee of the Company or one of its Subsidiaries (the “Grantee”).  Capitalized terms, unless defined in this Agreement, shall have the same meanings as in the Plan (as defined below). 

WHEREAS, in connection with the Grantee’s employment with the Company or one of its Subsidiaries, the Company granted to the Grantee as of January 1, 2018 (the “Grant Date”) an option to purchase 9,906 common shares, par value $0.01, of the Company (“Options”) pursuant to the terms and conditions of this Agreement and the Company’s 2011 Management Equity Incentive Plan (the “Plan”).

WHEREAS, the Board or its duly authorized designee has determined that it would be to the advantage, and in the best interest, of the Company and its shareholders to grant the Options provided for herein to the Grantee as an incentive for increased efforts during employment with the Company or one of its Subsidiaries.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. GRANT OF Options AWARD

(a) Grant.  Subject to the terms and conditions of the Plan and this Agreement, the Company has granted to the Grantee Options for 9,906 shares, which will be earned based on the vesting provision of Section 2(a).

(b) Plan.  The foregoing award was granted under the Plan, which is incorporated herein by this reference and made a part of this Agreement.

(c) No Rights as Stockholder.  It shall be understood that none of the terms contained any such rights unless and until such Grantee receives Shares in connection with the exercise of Options.

2. RIGHT TO EXERCISE; VESTING

(a) Vesting.  Subject to the provisions of this Agreement, the Options granted hereunder shall vest as of the earlier of: (a) December 31, 2018, provided however that Grantee is

employed by the Company or one of its subsidiaries as of that date, or (b) the Termination Date (as hereinafter defined) but only if the Termination Event is either (i) a termination without Cause, or (ii) a resignation with Good Reason.

(b) Effect of Vesting.  For each vested Option the Grantee may exercise such Option for one share.

3. Exercise Procedures

(a) Notice of Exercise.  The Grantee may exercise its Options prior to their expiration as set forth in Section 6 to the extent they are vested by giving written notice to the Company in form and substance reasonably satisfactory to the Company (such notice, a “Notice of Exercise”) specifying the election to exercise such Options, the number of vested Options which are being exercised and the form of payment.  The Notice of Exercise shall be signed by the Grantee.  The Grantee shall deliver to the Company, at the time of giving the notice, payment in a form permissible under Section 4 for the full amount of the Exercise Price and, if such person is not then party to the Stockholders Agreement, such person shall be required to execute a Joinder Agreement.

(b) Issuance of Shares.  After receiving a properly completed and executed Notice of Exercise and payment for the full amount of the Exercise Price as required by Section 3(a) and, if applicable, an executed Joinder Agreement, the Company shall cause to be issued a certificate or certificates for the Purchased Shares (as defined below), registered in the name of the Grantee (or in the names of such person and his spouse as community property or as joint tenants with right of survivorship), provided that as a condition to the issuance of Purchased Shares hereunder, the Grantee shall make, as of the time of issuance of such Purchased Shares, representations and warranties in a form satisfactory to the Company and substantially similar to those contained in Exhibit A.  In connection with any exercise of these Options, the Person exercising these Options shall deliver to the Company a duly executed blank share power in the form attached hereto as Exhibit B.  The date of the issuance of the Purchased Shares by the Company to the Grantee, the “Exercise Date”.

(c) Withholding Requirements.  The Company may withhold any tax (or other governmental obligation) required to be withheld in connection with the exercise of the Options, and as a condition to the settlement of any exercise of the Options.  Such withholding may be made from any source (including any salary or other compensation payable to the Grantee), and the Grantee shall make arrangements satisfactory to the Company to enable it to satisfy all such withholding requirements as a condition to the exercise of the Options (including by remitting to the Company an amount in cash sufficient to satisfy the withholding obligation).  For the avoidance of doubt, the Company will not withhold any amounts greater than the statutory minimum.

4. payment of EXERCISE price

(a) Cash or Check.  In connection with an exercise of the Options, all or part of the Exercise Price may be paid in cash or by check.

(b) Net Exercise.  Notwithstanding anything in this Agreement to the contrary, in connection with an exercise of the Options, all or part of the Exercise Price may be paid by reducing the number of Shares being purchased pursuant to such exercise by the number of such Shares having a Fair Market Value equal to the Exercise Price.

(c) Other Methods of Payment for Shares.  At the sole discretion of the Board, and subject to applicable law, all or any part of the Exercise Price and any applicable withholding requirements may be paid by any other method permissible at the time under the terms of the Plan.

5. SECURITIES LAW ISSUES, TRANSFER restrictionS

(a) Grantee Acknowledgements and Representations.  The Grantee understands and agrees that:  (i) the Options have not been registered under the Securities Act, (ii) the Options are restricted securities under the Securities Act and (iii) the Options may not be resold or transferred unless they are first registered under the Securities Act or unless an exemption from such registration is available.  The Grantee hereby makes the representations and warranties set forth in Exhibit A hereto.

(b) No Registration Rights.  The Company may, but shall not be obligated to, register or qualify the issuance of Purchased Shares to the Grantee, or the resale of any such Purchased Shares by the Grantee under the Securities Act or any other applicable law. 

(c) Transfers.  No Option shall be transferable to any Person for any reason. Any attempt to Transfer any Option shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer.  Any Purchased Shares shall be subject to the restrictions on Transfer as set forth in Article 3 of the Stockholders Agreement, except with respect to a Transfer by will or by the laws of descent and distribution.  Unless otherwise permitted pursuant to the Stockholders Agreement, the Grantee shall not Transfer any Purchased Shares (i) except in compliance with the provisions of Article 3 of the Stockholders Agreement, and (ii) unless the transferee shall have agreed in writing to be bound by the terms of this Agreement in a manner acceptable to the Board and otherwise acknowledging that such Purchased Shares are subject to the restrictions set forth in this Agreement.  Any attempt to Transfer any Purchased Shares not in compliance with this Agreement shall be null and void and have no force or effect, and the Company shall not, and shall cause any transfer agent not to, give any effect in such entity’s share records to such attempted Transfer. The Grantee acknowledges that the transfer restrictions contained in this Agreement are reasonable and in the best interests of the Company.

6. TERM of Grant.

Subject to the provisions of Section 2(a), the Options subject to in this Agreement shall expire on the tenth anniversary following the date of this Agreement, except in (a) the case of death or Disability, in which case the Options subject to this Agreement terminate on the first anniversary of the date of death or Disability, and (b) the case of Grantees who have not been employed at

least five years as of the date of a Termination Event, as defined below, in which case the Options subject to this Agreement terminate on the Termination Date, also defined below. 

7. Right of Repurchase upon TERMINATION OF EMPLOYMENT 

(a) Repurchase Rights.

1. Upon the termination of employment of the Grantee by the Company or any of its Subsidiaries for any reason (the reason for the termination of such employment, the “Termination Event” and the date of such termination, the “Termination Date”), subject to the provisions of this Section 7 and the prior approval of the Compensation Committee of the Board (or if there is no such Compensation Committee, the Board), the Company shall have the right (but not the obligation) to purchase, and if such right is exercised, the Grantee shall sell, and shall cause any Permitted Transferees of the Grantee to sell (and such Permitted Transferees shall sell), to the Company, all or any portion (as determined by the Company) of the Purchased Shares (if any) owned by the Grantee or his Permitted Transferees at a price per Purchased Share equal to an amount (the “Termination Price”) (as determined pursuant to Section 7(b) below); provided,  that the parties acknowledge that any unvested Options held by the Grantee as of the Termination Date shall be cancelled pursuant to this Agreement.

2. With respect to the Purchased Shares, the Company shall notify the Grantee in writing, within the Call Period whether the Company will exercise its right to purchase the Purchased Shares (the date on which the Grantee is so notified, the “Call Notice Date”). 

3. The closing of the purchase by the Company of Purchased Shares pursuant to this Section 7 shall take place at the principal office of the Company, on the date chosen by the Company, which date shall, except as may be reasonably necessary to determine the Termination Price, in no event be more than 45 days after the Call Notice Date.  At such closing, (A) the Company shall pay the Grantee and/or such Grantee’s Permitted Transferees, as applicable, against delivery of duly endorsed certificates described below representing such Purchased Shares, the aggregate Termination Price by wire transfer of immediately available federal funds and (B) the Grantee and/or such Grantee’s Permitted Transferees, as applicable, shall deliver to the Company a certificate or certificates representing the Purchased Shares to be purchased by the Company, duly endorsed, or with share (or equivalent) powers duly endorsed, for transfer with signature guaranteed, free and clear of any lien or encumbrance, with any necessary share (or equivalent) transfer tax stamps affixed. The delivery of a certificate or certificates for the Purchased Shares by any Person selling such Purchased Shares pursuant to this Section 7(a)(iii) shall be deemed a representation and warranty by such Person that: (w)

such Person has full right, title and interest in and to such Purchased Shares; (x) such Person has all necessary power and authority and has taken all necessary action to sell such Purchased Shares as contemplated; (y) such Purchased Shares are free and clear of any and all liens or encumbrances; and (z) there is no adverse claim with respect to such Purchased Shares.

(b) Termination Pricing.  The Termination Price of any Purchased Share shall be determined as follows:

1. If the Termination Event was a resignation by the Grantee with Good Reason or termination of the employment of the Grantee by the Company or any of its Subsidiaries without Cause, the Termination Price for such Purchased Share shall be the Fair Market Value on the FMV Calculation Date,

2. if the Termination Event was as a result of the death or Disability of the Grantee, the Termination Price for such Purchased Share shall be the Fair Market Value on the Termination Date, and 

3. if the Termination Event was a termination of the employment of the Grantee by the Company or any of its Subsidiaries with Cause, or was a resignation by the Grantee without Good Reason, the Termination Price for such Purchased Share shall be the lower of (A) the Fair Market Value on the FMV Calculation Date or (B) the Exercise Price per Share.

(c) Payment Terms.  In the event that the Company exercises a Right of Repurchase pursuant to Section 7 of this Agreement, the Company shall pay the Termination Price in cash; provided,  however, that if the Company is at the time of the Purchase Closing prohibited from purchasing all or any portion of such Purchased Shares (i) because restrictive covenants or other provisions contained in the documents evidencing such entity’s or any of its Affiliates’ indebtedness for borrowed money do not permit or allow such entity to make such payments in cash in whole or in part; (ii) pursuant to applicable law; or (iii) that the Grantee was terminated for Cause, resigned without Good Reason, or if the Grantee was not employed by the Company or one of its Subsidiaries for at least five years prior to the termination for Cause or resignation without Good Reason , then, the Termination Price may be paid by the execution and delivery by the Company of a promissory note or other deferred cash payment arrangement (if applicable, any promissory note to be subordinated to the indebtedness for borrowed money of such company or any of its Affiliates) bearing interest at the prime rate, as published in the Wall Street Journal, Eastern edition, on the first Business Day immediately prior to the day on which such promissory note or other deferred cash payment is issued, with principal and accrued interest payable at such time as is required in the Board’s determination to ensure that any payment pursuant to such promissory note or other deferred cash payment arrangement is not prohibited because of any of the matters described in clauses (i) or (ii) of this Section 7(c) above. 

8. ADJUSTMENT OF SHARES

In the event of a Recapitalization, the terms of this Award (including, without limitation, the number and kind of Shares subject to this Award) shall be adjusted as set forth in Section 13 (a) of the Plan.  In the event that the Company is a party to a merger or consolidation, this Award shall be subject to Section 13(b) of the Plan.

9. MISCELLANEOUS PROVISIONS

(a) No Retention Rights.  Nothing in this Agreement or in the Plan shall confer upon the Grantee any right to continue in Service or interfere with or otherwise restrict in any way the rights of the Company or any Subsidiary employing the Grantee, which rights are hereby expressly reserved by the Company and any Subsidiary employing the Grantee, to terminate the Grantee’s Service at any time and for any reason, with or without Cause.

(b) Notices.  All notices, requests and other communications under this Agreement shall be in writing and shall be delivered in person (by courier or otherwise), mailed by certified or registered mail, return receipt requested,or sent by facsimile transmission, as follows:

If to the Company, to:

Community Choice Financial Inc.

7001 Post Road, Suite 200

Dublin, OH 43016

Attention:   Stock Option Administrator

If to the Grantee, to the address that he/she most recently provided to the Company,

(c) or, in each case, at such other address or fax number as such party may hereafter specify for the purpose of notices hereunder by written notice to the other party hereto.  All notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a Business Day in the place of receipt.  Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt.  Any notice, request or other written communication sent by facsimile transmission shall be confirmed by certified or registered mail, return receipt requested, posted within one Business Day, or by personal delivery, whether by courier or otherwise, made within two Business Days after the date of such facsimile transmissions; provided that such confirmation mailing or delivery shall not affect the date of receipt, which will be the date that the facsimile successfully transmitted the notice, request or other communication.

(d) Entire Agreement.  This Agreement and the Plan, together with the Stockholders Agreement and the other agreements referred to herein and therein and any schedules, exhibits and other documents referred to herein or therein, constitute the entire agreement and understanding among the parties hereto in respect of the subject matter hereof and thereof and supersede all prior and contemporaneous arrangements, agreements and

understandings, both oral and written, whether in term sheets, presentations or otherwise, among the parties hereto, or between any of them, with respect to the subject matter hereof and thereof.

(e) Amendment; Waiver.  No amendment or modification of any provision of this Agreement shall be effective unless signed in writing by or on behalf of the Company and the Grantee, except that the Company may amend or modify the Agreement without the Grantee’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement.  The failure of the Company in any instance to exercise the Right of Repurchase shall not constitute a waiver of any other repurchase rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Grantee.  No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.  Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which made or given.

(f) Assignment.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Grantee except pursuant to a Transfer in accordance with the provisions of this Agreement.

(g) Successors and Assigns; No Third Party Beneficiaries.  This Agreement shall inure to the benefit of and be binding upon the Company and the Grantee and their respective heirs, successors, legal representatives and permitted assigns.  Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Company and the Grantee, and their respective heirs, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

(h) Governing Law, Venue.  This Agreement and any matters or disputes related to, in connection with, or arising under this Agreement shall be governed by the laws of the State of Ohio, without regard to the conflicts of laws rules of such state.  Any legal action or proceeding with respect this Agreement shall be brought in the federal or state court sitting in the State of Ohio, and, by execution and delivery of this Agreement, each party hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the exclusive jurisdiction of such courts.  Each party irrevocably waives any objection which it may now or hereafter have to the laying of venue of the aforesaid actions or proceedings arising out of or in connection with this Agreement in the courts referred to in this paragraph and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(i) Waiver of Jury Trial.   The Grantee hereby irrevocably waives all right of trial by jury in any legal action or proceeding (including counterclaims) relating to or arising out of or in connection with this Agreement or any of the transactions or

relationships hereby contemplated or otherwise in connection with the enforcement of any rights or obligations hereunder.

(j) Interpretation.  Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation apply: 

i. Headings.  The division of this Agreement into Sections and other subdivisions and the insertion of headings are for convenience of reference only and do not alter the meaning of, or affect the construction or interpretation of, this Agreement.

ii. Section References.  All references in this Agreement to any “Section” are to the corresponding Section of this Agreement.

iii. Schedules/Exhibits.  Any capitalized terms used in any Schedule or Exhibit to this Agreement but are not otherwise defined therein have the meanings set forth in this Agreement.

(k) Severability.  If any provision of this Agreement is invalid, illegal, or incapable of being enforced by any law, all other provisions of this Agreement remain in full force and effect so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party.  If any provision of this Agreement is held to be invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

(l) Counterparts.  The parties may execute this Agreement in one or more counterparts, each of which constitutes an original copy of this Agreement and all of which, collectively constitute only one agreement.  The signatures of all the parties need not appear on the same counterpart.

(m) Grantee Undertaking.  The Grantee agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to carry out or effect one or more of the obligations or restrictions imposed on either the Grantee or upon the Options or any Purchased Shares pursuant to the provisions of this Agreement. 

(n) Plan; Stockholders Agreement; Counsel.  The Grantee acknowledges and understands that material definitions and provisions concerning the Options or any Purchased Shares and the Grantee’s rights and obligations with respect thereto are set forth in the Plan and the Stockholders Agreement.  The Grantee has had the opportunity to retain counsel, and has read carefully, and understands, the provisions of such documents. 

10. Definitions

“Affiliate” shall mean, with respect to any specified Person, (i) any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under

common control with, such specified Person (for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise); provided,  however, that neither the Company nor any of its Subsidiaries shall be deemed an Affiliate of any of the Stockholders (and viceversa), and (ii) if such specified Person is an investment fund, any other investment fund the primary investment advisor to which is the primary investment advisor to such specified Person.

“Board” means the Board of Directors of the Company, as constituted from time to time or, if a Committee has been appointed, such Committee.

“Business Day” has the meaning ascribed to such term in the Stockholders Agreement. 

“Call Period” shall mean from the Termination Date until:

if the Termination Event is a termination of the employment for any reason other than death or Disability of the Grantee, the later of (A) the date that is 60 days after such Termination Date and (B) the date that is 190 days after the Exercise Date,

if the Termination Event is a termination of the employment of the Grantee by the Company or any of its Subsidiaries as a result of the death or Disability of the Grantee, the date that is the later of (A) 60 days after the Termination Date or (B) the date which is 60 days after the Exercise Date, or

“Cause” shall mean:

(i)Grantees’s failure or refusal to comply, on a timely basis, with any lawful direction or instruction of the Board;

(ii)Grantee’s gross negligence or willful misconduct in the performance of his/her duties as an employee of the Company;

(iii)Grantee’s commission of fraud, embezzlement, misappropriation of funds, breach of fiduciary duty or act of dishonesty against the Company;

(iv)Conviction of Grantee of a felony or entry by Grantee of a plea of nolo contendre or a plea of guilty under an indictment to a felony; or

(v)Grantee’s habitual drug addiction or intoxication.

The Company shall have the right to terminate Grantee’s employment for Cause. 

 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder. 

“Committee” means the compensation committee of the Board of Directors of the Company. 

 “Disability” means Grantee’s incapacity due to physical or mental illness such that  Grantee is unable to perform his/her duties for 180 consecutive days and, within 30 days after a notice of termination, which notice of termination may not be given until the expiration of such consecutive 180 day period, is given to Grantee, Grantee has not returned to work.    

“Exercise Price” means $1.00.

“Fair Market Value” or “FMV” with respect to a share of stock of the Company, shall mean (i) in the event that such shares are listed on an established U.S. exchange or through the NASDAQ National Market or any established over-the-counter trading system, the average of the closing prices of such Group Equity Securities on such exchange if listed or, if not so listed, the average bid and asked price of such shares reported on the NASDAQ National Market or any established over-the-counter trading system on which prices for such shares are quoted, in each case, for a period of twenty trading days prior to such date of determination, or (ii) if such shares are not publicly traded, a good faith determination by the Board through a reasonable application of a reasonable valuation method.  Such determination shall be conclusive and binding on all persons. 

“FMV Calculation Date” means:

i. if the Termination Event is a termination by the Company or any of its Subsidiaries without Cause, a resignation by the Grantee with Good Reason or a resignation by the Grantee without Good Reason after three years of Service:

ii. if the Exercise Date occurred 180 days or more before the Termination Date, the Termination Date, and

iii. if the Exercise Date occurred 179 days or less before the Termination Date or occurs after the Termination Date, then the Call Notice Date;

iv. if the Termination Event is as a result of the death or Disability of the Grantee, then the Termination Date; and

v. if the Termination Event is a termination by the Company or any of its Subsidiaries with Cause, or a resignation by the Grantee without Good Reason during the Grantee’s, then the Termination Date.

“Good Reason”  Grantee may resign for “Good Reason” within 30 days after Grantee has actual knowledge of the occurrence, without the written consent of Grantee, of one of the following events:

(i)a reduction in Grantee’s base salary, or non-timely payment of base salary or earned annual bonus not cured by the Company within five business days;  

(ii)a material diminution in Grantee’s duties or responsibilities not cured by the Company within 20 days after written notice to the Company. For the purposes of this section, a “material diminution in Grantee’s duties or responsibilities” shall not include a realignment or reorganization of executive responsibilities as the result of Company growth or contraction or the growth or contraction of the Company’s management team, but shall include the removal or withdrawal of substantially all of the Executive’s duties or responsibilities; or

(iii)Grantee’s retirement providedhowever that Grantee shall give not less than 30 days written notice thereof.

“Joinder Agreement” means an agreement substantially in the form of Exhibit A of the Stockholders Agreement, pursuant to which the Grantee shall become a party to the Stockholders Agreement and subject to all of the rights, restrictions and obligations contained therein.

“Permitted Transferee”has the meaning ascribed to such term in the Stockholders Agreement.

“Person” means an individual, corporation, limited liability company, partnership, association, trust or other entity or organization. 

“Purchased Shares” means any Shares issued pursuant to the exercise of any Option in accordance with the terms of this Agreement.

“Right of Repurchase” means the Company’s right of repurchase described in Section 7 of this Agreement.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

“Service” means service as an employee. 

“Share(s)” means common share(s) of the Company.

“Stockholders Agreement” means that certain Stockholders Agreement dated as of April 28, 2011, by and among the Company, the Grantee and the other parties thereto (as the same shall be amended, modified or supplemented from time to time).  

“Subsidiary”  means, with respect to the Company, any other Person in which the Company, directly or indirectly through one or more Affiliates or otherwise, beneficially owns at least 50% of either the ownership interest (determined by equity or economic interests) in, or the voting control of, such other Person. 

“Transfer” has the meaning ascribed in such term in the Stockholders Agreement. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

COMMUNITY CHOICE FINANCIAL INC.

By: /s/ William E. Saunders, Jr.

Name:  William E. Saunders, Jr.

Title:     Chairman/CEO

/s/ Bridgette C. Roman

Bridgette C. Roman

EXHIBIT A

to Option Award Agreement

Investment Representations and Warranties

The Grantee hereby represents and warrants to the Company that:

1. The Options and Purchased Shares received by him will be held by him for investment only for his own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee has no current intention of selling, granting participation in or otherwise distributing the Options or Purchased Shares in violation of applicable U.S. federal or state or foreign securities laws.  The Grantee does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity, or to any third person or entity, with respect to any of the Options or Purchased Shares, in each case, in violation of applicable U.S. federal or state or foreign securities laws.

2. The Grantee understands that although the Company has a pending S-1 Registration Statement with the U.S. Securities and Exchange Commission that as of the date of this grant, the issuance of the Options and Purchased Shares have not been registered under the Securities Act or any applicable U.S. state or foreign securities laws, and that the Options and Purchased Shares are being issued in reliance on an exemption from registration, which exemption depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Grantee’s representations as expressed herein.

3. The Grantee has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of his owning the Options and Purchased Shares.  The Grantee is a sophisticated investor, has relied upon independent investigations made by the Grantee and, to the extent believed by the Grantee to be appropriate, the Grantee’s representatives, including the Grantee’s own professional, tax and other advisors, and is making an independent decision to invest in the Options and Purchased Shares.  The Grantee has been furnished with such documents, materials and information that the Grantee deems necessary or appropriate for evaluating an investment in the Company, and the Grantee has read carefully such documents, materials and information and understands and has evaluated the types of risks involved with holding the Options and Purchased Shares.  The Grantee has not relied upon any representations or other information (whether oral or written) from the Company or its shareholders, directors, officers or affiliates, or from any other person or entity, in connection with his investment in the Options and Purchased Shares.  The Grantee acknowledges that the Company has not given any assurances with respect to the tax consequences of the ownership and disposition of the Options and Purchased Shares.

4. The Grantee has had, prior to his being granted the Options and Purchased Shares, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the transactions contemplated by the Agreement and the Grantee’s holding of the Options and Purchased Shares and to obtain additional information necessary to verify the accuracy of any information furnished to his or to which she had access.  The Grantee confirms that she has satisfied himself with respect to any of the foregoing matters.

5. The Grantee understands that no U.S. federal or state or foreign agency has passed upon the Options or Purchased Shares or upon the Company, or upon the accuracy, validity or completeness of any documentation provided to the Grantee in connection with the transactions contemplated by the Agreement, nor has any such agency made any finding or determination as to holding the Options or Purchased Shares.

6. The Grantee understands that there are substantial restrictions on the transferability of the Options and Purchased Shares and that on the date of the Agreement and for an indefinite period thereafter there will be no public market for the Options or Purchased Shares and, accordingly, it may not be possible for the Grantee to liquidate his investment in case of emergency, if at all.  In addition, the Grantee understands that the Agreement and Stockholders Agreement contain substantial restrictions on the transferability of the Options and Purchased Shares and provide that, in the event that the conditions relating to the transfer of any Options or Purchased Shares in such document has not been satisfied, the holder shall not transfer any such Options or Purchased Shares, and unless otherwise specified the Company will not recognize the transfer of any such Options or Purchased Shares on its books and records or issue any share certificates representing any such Options or Purchased Shares, and any purported transfer not in accordance with the terms of the Agreement or the Stockholders Agreement shall be void.  As such, Grantee understands that: a restrictive legend or legends in a form to be set forth in the Agreement and the Stockholders Agreement will be placed on the certificates representing the Options and Purchased Shares; a notation will be made in the appropriate records of the Company indicating that each of the Options and Purchased Shares are subject to restrictions on transfer and, if the Company should at some time in the future engage the services of a securities transfer agent, appropriate stop-transfer instructions will be issued to such transfer agent with respect to the Options and Purchased Shares; and the Grantee will sell, transfer or otherwise dispose of the Options or Purchased Shares only in a manner consistent with its representations set forth herein and then only in accordance with the Agreement and the Stockholders Agreement.

7. The Grantee understands that (i) the neither the Options nor the Purchased Shares may not be sold, transferred or otherwise disposed of without registration under the Securities Act or an exemption therefrom, (ii) the Options and Purchased Shares have not been registered under the Securities Act; (iii) the Options and Purchased Shares must be held indefinitely and she must continue to bear the economic risk of holding the Options and Purchased Shares unless such Options and Purchased Shares are subsequently registered under the Securities Act or an exemption from such registration is available; (iv) the Grantee is prepared to bear the economic risk of holding the Options and Purchased Shares for an indefinite period of time; (v) it is not anticipated that there will be any

public market for the Options or Purchased Shares; (vi) the Options and Purchased Shares are characterized as “restricted securities” under the U.S. federal securities laws; and (vii) the Options and Purchased Shares may not be sold, transferred or otherwise disposed of except in compliance with federal, state and local law.

8. The Grantee understands that an investment in the Options or Purchased Shares is not recommended for investors who have any need for a current return on this investment or who cannot bear the risk of losing their entire investment.  In that regard, the Grantee understands that his holding the Options and Purchased Shares involves a high degree of risk of loss.  The Grantee acknowledges that: (i) he/she has adequate means of providing for his current needs and possible personal contingencies and has no need for liquidity in this investment; (ii) his/her commitment to investments which are not readily marketable is not disproportionate to his net worth; and (iii) his/her holding the Options and Purchased Shares will not cause his overall financial commitments to become excessive. 

EXHIBIT B

to Option Award Agreement

Share Power

IRREVOCABLE STOCK POWERS

COMMUNITY CHOICE FINANCIAL INC.

FOR VALUE RECEIVED, Bridgette C. Roman, does hereby sell, assign and transfer unto ____________________    _______________ Common Shares of Community Choice Financial Inc., par value $0.01, represented by Certificate No. ___ herewith and does hereby irrevocably constitute and appoint ______________________ attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises.   

Dated:  _________________

By: William E. Saunders, Jr

William E. Saunders, Jr.

EX-31.1

EXHIBIT 31.1

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER PURSUANT TO

SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a), AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, William E. Saunders, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Community Choice Financial Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: May  14, 2018	By:	/s/ WILLIAM E. SAUNDERS, JR.
		William E. Saunders, Jr.
		Chief Executive Officer
		Principal Executive Officer

1

EX-31.2

EXHIBIT 31.2

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER PURSUANT TO

SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a), AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael Durbin, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Community Choice Financial Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: May 14, 2018	By:	/s/ MICHAEL DURBIN
		Michael Durbin
		Chief Financial Officer
		Principal Financial and
		Principal Accounting Officer

1

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Community Choice Financial Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2018 (the “Report”), I, William E. Saunders, Jr., Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes- Oxley Act”), that to my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 14, 2018	/s/ WILLIAM E. SAUNDERS, JR.
	William E. Saunders, Jr.
	Chief Executive Officer
	Principal Executive Officer

This certification accompanies this Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act and shall not, except to the extent required by such Sarbanes-Oxley Act, be deemed filed by the Company for purposes of Section 18 of the Exchange Act. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

1

EX-32.2

EXHIBIT 32.2

CERTIFICATION REQUIRED BY 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Community Choice Financial Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2018 (the “Report”), I, Michael Durbin, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), that to my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 14, 2018	/s/ MICHAEL DURBIN
	Michael Durbin
	Chief Financial Officer
	Principal Financial and
	Principal Accounting Officer

This certification accompanies this Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act and shall not, except to the extent required by such Sarbanes-Oxley Act, be deemed filed by the Company for purposes of Section 18 of the Exchange Act. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

1

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2018 shares
Document and Entity Information
Entity Registrant Name	Community Choice Financial Inc.
Entity Central Index Key	0001528061
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding	7,990,020
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Current Assets
Cash and cash equivalents	$ 85,274	$ 66,627
Restricted cash	4,420	4,585
Finance receivables, net of allowance for loan losses of $12,293 and $13,517	68,286	89,707
Card related pre-funding and receivables	841	1,062
Other current assets	13,522	15,271
Total current assets	172,343	177,252
Noncurrent Assets
Finance receivables, net of allowance for loan losses of $2,510 and $2,810	3,626	4,632
Property, leasehold improvements and equipment, net	24,816	26,848
Other intangible assets	802	924
Security deposits	2,429	2,750
Total assets	204,016	212,406
Current Liabilities
Accounts payable and accrued liabilities	31,803	39,566
Money orders payable	8,024	7,169
Accrued interest	11,942	5,145
Current portion of capital lease obligation	160	371
Current portion of subsidiary notes payable, net of deferred issuance costs of $1 and $1	120	118
Deferred revenue	2,535	2,535
Total current liabilities	54,584	54,904
Noncurrent Liabilities
Lease termination payable	569	818
Line of credit, net of deferred issuance costs of $4,201 and $1,871	42,799	45,129
Subsidiary notes payable, net of deferred issuance costs of $2,207 and $762	59,600	61,077
Senior secured notes, net of deferred issuance costs of $1,365 and $1,664	248,425	248,126
Deferred revenue	6,887	7,520
Total liabilities	412,864	417,574
Commitments and Contingencies
Stockholders' Equity
Preferred stock, par value $.01 per share, 3,000 shares authorized, no shares issued and outstanding
Common stock, par value $.01 per share, 300,000 authorized shares and 7,990 outstanding shares at March 31, 2018 and December 31, 2017	90	90
Additional paid-in capital	129,683	129,675
Retained deficit	(338,571)	(334,883)
Treasury stock	(50)	(50)
Total stockholders' deficit	(208,848)	(205,168)
Total liabilities and stockholders' equity	$ 204,016	$ 212,406

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Finance receivables, net
Finance receivables current, allowance for loan losses (in dollars)	$ 12,293	$ 13,517
Finance receivables noncurrent, allowance for loan losses (in dollars)	$ 2,510	$ 2,810
Stockholders' equity
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	3,000	3,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	300,000	300,000
Common stock, shares outstanding	7,990	7,990
Revolving credit facility
Finance receivables, net
Net of deferred issuance costs, noncurrent liabilities (in dollars)	$ 4,201	$ 1,871
Subsidiary Note payable
Finance receivables, net
Net of deferred issuance costs, current liabilities (in dollars)	1	1
Net of deferred issuance costs, noncurrent liabilities (in dollars)	2,207	762
Senior secured notes payable
Finance receivables, net
Net of deferred issuance costs, noncurrent liabilities (in dollars)	$ 1,365	$ 1,664

XML

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenues:
Total Revenues	$ 87,651	$ 85,352
Operating expenses:
Salaries	17,132	17,273
Provision for loan losses	22,635	19,540
Occupancy	6,343	6,629
Advertising and marketing	1,011	814
Lease termination	97	47
Depreciation and amortization	2,223	2,538
Other	11,025	11,915
Total operating expenses	60,466	58,756
Operating gross profit	27,185	26,596
Corporate and other expenses:
Corporate expenses	17,602	20,186
Lease termination		1,762
Depreciation and amortization	1,093	1,309
Interest expense, net	12,178	11,371
Total corporate and other expenses	30,873	34,628
Loss from continuing operations, before tax	(3,688)	(8,032)
Provision for income taxes		333
Net loss	(3,688)	(8,365)
Finance receivable fees
Revenues:
Total Revenues	50,932	49,051
Credit service fees
Revenues:
Total Revenues	19,196	18,139
Check cashing fees
Revenues:
Total Revenues	11,692	12,126
Card fees
Revenues:
Total Revenues	1,948	2,007
Other
Revenues:
Total Revenues	$ 3,883	$ 4,029

XML

Consolidated Statements of Stockholders' Equity - 3 months ended Mar. 31, 2018 - USD ($) $ in Thousands	Common Stock	Treasury Stock	Additional Paid-In Capital	Retained Deficit	Total
Balance at Dec. 31, 2017	$ 90	$ (50)	$ 129,675	$ (334,883)	$ (205,168)
Balance (in shares) at Dec. 31, 2017	7,990,020
Increase (Decrease) in Stockholders' Equity
Stock-based compensation expense			8		8
Net loss				(3,688)	(3,688)
Balance at Mar. 31, 2018	$ 90	$ (50)	$ 129,683	$ (338,571)	$ (208,848)
Balance (in shares) at Mar. 31, 2018	7,990,020

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash flows from operating activities
Net loss	$ (3,688)	$ (8,365)
Adjustments to reconcile net loss to net cash provided by operating activities:
Provision for loan losses	22,635	19,540
Loss on disposal of assets	113	1,042
Depreciation	3,193	3,723
Amortization of note discount and deferred debt issuance costs	908	728
Amortization of intangibles	123	124
Deferred income taxes		211
Stock-based compensation	8	32
Changes in assets and liabilities:
Short-term investments		500
Card related pre-funding and receivables	221	(184)
Other assets	2,069	6,590
Deferred revenue	(633)	(475)
Accrued interest	6,797	6,793
Money orders payable	855	(378)
Lease termination payable	(249)	1,048
Accounts payable and accrued expenses	(7,763)	(8,729)
Net cash provided by operating activities	24,589	22,200
Cash flows from investing activities
Net receivables originated	(208)	(2,721)
Purchase of leasehold improvements and equipment	(1,274)	(1,001)
Net cash used in investing activities	(1,482)	(3,722)
Cash flows from financing activities
Payments on subsidiary note	(30)	(29)
Payments on capital lease obligations	(211)	(248)
Net payments on lines of credit		(2,250)
Debt issuance costs	(4,384)
Net cash used in financing activities	(4,625)	(2,527)
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	18,482	15,951
Cash and cash equivalents and restricted cash:
Beginning	71,212	109,348
Ending	$ 89,694	$ 125,299

XML

Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Consolidated Statements of Cash Flows
Cash and cash equivalents	$ 85,274	$ 66,627	$ 121,784	$ 106,333
Restricted cash	4,420	4,585	3,515	3,015
Total cash and cash equivalents and restricted cash	$ 89,694	$ 71,212	$ 125,299	$ 109,348

XML

Ownership, Nature of Business, and Significant Accounting Policies

3 Months Ended

Mar. 31, 2018

Ownership, Nature of Business, and Significant Accounting Policies

Ownership, Nature of Business, and Significant Accounting Policies

Note 1. Ownership, Nature of Business, and Significant Accounting Policies

Nature of business:  Community Choice Financial Inc. (together with its consolidated subsidiaries, “CCFI” or “the Company”) owned and operated 484 retail locations in 12 states and was licensed to deliver similar financial services over the internet in 30 states as of March 31, 2018. Through its network of retail locations and over the internet, the Company provides customers a variety of financial products and services, including secured and unsecured, short and medium‑term consumer loans, check cashing, prepaid debit cards, and other services that address the specific needs of its individual customers.

A summary of the Company’s significant accounting policies follows:

Basis of presentation:  The accompanying interim unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10‑Q and accounting principles generally accepted in the United States (“GAAP”) for interim financial information. They do not include all information and footnotes required by GAAP for complete financial statements. Although management believes that the disclosures are adequate to prevent the information from being misleading, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2017, included in the Company’s Annual Report on Form 10‑K filed with the Securities & Exchange Commission on April 2, 2018. All adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial condition, have been included. The results for any interim period are not necessarily indicative of results to be expected for the year ending December 31, 2018.

Basis of consolidation:  The accompanying consolidated financial statements include the accounts of CCFI. All significant intercompany accounts and transactions have been eliminated in consolidation.

Business segments:  FASB Accounting Standards Codification (“ASC”) Topic 280 Segment Reporting requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way operating segments were determined and other items. The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in determining how to allocate resources and assess performance. The Company operates in two segments: Retail financial services and Internet financial services.

Equity method investments:    Entities and investments over which the Company exercises significant influence over the activities of the entity but which do not meet the requirements for consolidation are accounted for using the equity method of accounting pursuant to ASC 323, whereby the Company records its share of the underlying income or loss of these entities. Intercompany profit arising from transactions with affiliates is eliminated to the extent of its beneficial interest. Equity in losses of equity method investments is not recognized after the carrying value of an investment, including advances and loans, has been reduced to zero, unless guarantees or other funding obligations exist.

On September 30, 2017, the Company entered into a joint venture with a third party to offer insurance products through select retail locations in a certain market. The joint venture will be managed by the third party.

Revenue recognition:  Transactions include loans, credit service fees, check cashing, bill payment, money transfer, money order sales, and other miscellaneous products and services. The full amount of the check cashing fee is recognized as revenue at the time of the transaction. Fees and direct costs incurred for the origination of loans are deferred and amortized over the loan period using the interest method. The Company acts in an agency capacity regarding bill payment services, money transfers, card products, and money orders offered and sold at its retail locations. The Company records the net amount retained as revenue because the supplier is the primary obligor in the arrangement, the amount earned by the Company is fixed, and the supplier is determined to have the ultimate credit risk. Revenue on loans determined to be troubled debt restructurings are recognized at the impaired loans’ original interest rates until the impaired loans are charged off or paid by the customer. Credit service organization (“CSO”) fees are recognized over the arranged credit service period.

Finance receivables:  Finance receivables consist of short term and medium‑term consumer loans.

Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term loan products typically range in principal from $100 to $1,000, with a maturity between fourteen and thirty days, and include a written agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations, which vary by state. State statutes vary from charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advance by making cash payments or allowing a check or preauthorized debit to be presented. Secured consumer loans with a maturity of ninety days or less are included in this category and represented 14.0% and 14.5% of short-term consumer loans at March 31, 2018 and December 31, 2017, respectively.

Medium-term consumer loans can be unsecured or secured with a maturity greater than ninety days and up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000, and are evidenced by a promissory note with a maturity between three and thirty-six months. These consumer loans vary in structure depending upon the applicable laws and regulations where they are offered. The medium-term consumer loans are payable in installments or provide for a line of credit with periodic payments. Secured consumer loans with a maturity greater than ninety days are included in this category and represented 14.0% and 12.6% of medium-term consumer loans at March 31, 2018, and December 31, 2017, respectively.

Allowance for loan losses:  Provisions for loan losses are charged to income in amounts sufficient to maintain an adequate allowance for loan losses and an adequate accrual for losses related to guaranteed loans processed for third-party lenders under the CSO programs. The factors used in assessing the overall adequacy of the allowance for loan losses, the accrual for losses related to guaranteed loans made by third-party lenders and the resulting provision for loan losses include an evaluation by product, by market based on historical loan loss experience, and delinquency of certain medium-term consumer loans. The Company evaluates various qualitative factors that may or may not affect the computed initial estimate of the allowance for loan losses, by using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions.

For short term unsecured consumer loans, the Company’s policy is to charge off loans when they become past due. The Company’s policy dictates that, where a customer has provided a check or ACH authorization for presentment upon the maturity of a loan, if the customer has not paid off the loan by the due date, the Company will deposit the customer’s check or draft the customer’s bank account for the amount due. If the check or draft is returned as unpaid, all accrued fees and outstanding principal are charged-off as uncollectible. For short term secured loans, the Company’s policy requires that balances be charged off when accounts are either thirty or sixty days past due depending on the product.

For medium term secured and unsecured consumer loans that have a term of one year or less, the Company’s policy requires that balances be charged off when accounts are sixty days past due. For medium term secured and unsecured consumer loans that have an initial maturity of greater than one year, the Company’s policy requires that balances be charged off when accounts are ninety-one days past due.

In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. These reduced interest rates and changed payment terms were limited to loans that the Company believed the customer had the ability to pay in the foreseeable future. These loans were accounted for as troubled debt restructurings and represent the only loans considered impaired due to the nature of the Company’s charge-off policy.

Recoveries of amounts previously charged off are recorded to the allowance for loan losses or the accrual for third‑party losses in the period in which they are received.

Lease termination payable:  The Company records a liability in the consolidated balance sheets for the remaining lease obligations with the corresponding lease termination expense for closed retail locations disclosed in the operating expenses section, and closed corporate locations disclosed in the corporate and other expenses section, of the consolidated statements of operations, respectively.

Fair value of financial instruments:  Financial assets and liabilities measured at fair value are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are:

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

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

· Level 3—Unobservable inputs for assets and liabilities reflecting the reporting entity’s own assumptions.

The Company follows the provisions of ASC 820‑10, Fair Value Measurements and Disclosures, which applies to all assets and liabilities that are being measured and reported on a fair value basis. ASC 820‑10 requires a disclosure that establishes a framework for measuring fair value within GAAP and expands the disclosure about fair value measurements. This standard enables a reader of consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The standard requires that assets and liabilities carried at fair value be classified and disclosed in one of the three categories.

In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820-10. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The Company’s financial instruments consist primarily of cash and cash equivalents, finance receivables, restricted cash, and lines of credit. For all such instruments, other than senior secured notes and notes payable at March 31, 2018, and December 31, 2017, the carrying amounts in the consolidated financial statements approximate their fair values. Finance receivables are short term in nature and are originated at prevailing market rates and lines of credit bear interest at current market rates. The fair value of finance receivables at March 31, 2018 and December 31, 2017 approximates carrying value and is measured using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. 

The fair value of the Company’s 10.75% senior secured notes due 2019 (the “2019 notes”) and the 12.75% senior secured notes due 2020 (the “2020 notes”) were determined based on market yield on trades of the 2019 notes at the end of the recent reporting period.

	March 31, 2018
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	85,274	$	85,274	1
Restricted cash		4,420		4,420	1
Finance receivables		71,912		71,912	3
Financial liabilities:
10.75% Senior secured notes		237,290		222,103	1
12.75% Senior secured notes		12,500		11,479	2
Subsidiary Note payable		61,928		61,928	2
Line of Credit		47,000		47,000	2

	December 31, 2017
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	66,627	$	66,627	1
Restricted cash		4,585		4,585	1
Finance receivables		94,339		94,339	3
Financial liabilities:
10.75% Senior secured notes		237,290		212,636	1
12.75% Senior secured notes		12,500		10,841	2
Subsidiary Note payable		61,958		61,958	2
Line of Credit		47,000		47,000	2

Treasury Stock:  Treasury stock is reported at cost and consists of one million common shares at March 31, 2018 and December 31, 2017.

Recent Accounting Pronouncements:  In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective method. The adoption of ASC 606 did not impact the Company’s revenue recognition for consumer loan fees as these revenue streams are outside of the scope of ASC 606. Further, the Company has not identified any impacts to its consolidated financial statements that were material as a result of the adoption of ASC 606 for its CSO fees. The Company has not changed the presentation of its consolidated financial statements for assets, liabilities, or revenues from contracts with customers, nor has the Company recognized any cumulative effect adjustment as a result of the adoption of ASC 606.

In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash”. GAAP currently does not include specific guidance to address how to classify and present changes in restricted cash or restricted cash equivalents that occur when there are transfers between cash, cash equivalents, and restricted cash or restricted cash equivalents and when there are direct cash receipts into restricted cash or restricted cash equivalents or direct cash payments made from restricted cash or restricted cash equivalents. The amendments in this update require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update do not provide a definition of restricted cash or restricted cash equivalents. For public business entities the amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted the new standard effective in 2018. As a result, the Company no longer reports the changes in restricted cash as an operating activity. Instead, restricted cash is included in the beginning and ending cash and cash equivalents balances on the consolidated statements of cash flows.

Subsequent events:  The Company has evaluated its subsequent events (events occurring after March 31, 2018) through the issuance date of May 14, 2018.

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses

3 Months Ended

Mar. 31, 2018

Finance Receivables, Credit Quality Information and Allowance for Loan Losses

Finance Receivables, Credit Quality Information and Allowance for Loan Losses

Note 2. Finance Receivables, Credit Quality Information and Allowance for Loan Losses

Finance receivables representing amounts due from customers for advances at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31,		December 31,
	2018		2017
Short-term consumer loans	$	52,115	$	66,465
Medium-term consumer loans		36,860		46,903
Gross receivables	$	88,975	$	113,368
Unearned advance fees, net of deferred loan origination costs		(2,260)		(2,702)
Finance receivables before allowance for loan losses		86,715		110,666
Allowance for loan losses		(14,803)		(16,327)
Finance receivables, net	$	71,912	$	94,339
Finance receivables, net
Current portion	$	68,286	$	89,707
Non-current portion		3,626		4,632
Total finance receivables, net	$	71,912	$	94,339

Changes in the allowance for loan losses by product type for the three months ended March 31, 2018, are as follows:

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2018		Provision		Charge-Offs		Recoveries		3/31/2018		3/31/2018		of receivables
Short-term consumer loans	$	2,697	$	8,159	$	(18,424)	$	9,886	$	2,318	$	52,115	4.45	%
Medium-term consumer loans		13,630		8,397		(11,067)		1,525		12,485		36,860	33.87	%
	$	16,327	$	16,556	$	(29,491)	$	11,411	$	14,803	$	88,975	16.64	%

The provision for loan losses for the three months ended March 31, 2018, also includes losses from returned items from check cashing of $1,062.

The provision for short-term consumer loans of $8,159 is net of debt sales of $412 for the three months ended March 31, 2018.

The provision for medium-term consumer loans of $8,397 is net of debt sales of $562 for the three months ended March 31, 2018.

The Company evaluates all short-term and medium-term consumer loans collectively for impairment, except for individually evaluating medium-term loans that have been modified and classified as troubled debt restructurings. In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. The provision and subsequent charge off related to these loans totaled $20 and is included in the provision for medium-term consumer loans for the three months ended March 31, 2018. For these loans evaluated for impairment, there were $54 of payment defaults during the three months ended March 31, 2018. The troubled debt restructurings during the three months ended March 31, 2018 are subject to an allowance of $6 with a net carrying value of $14 at March 31, 2018.

Changes in the allowance for loan losses by product type for the three months ended March 31, 2017, are as follows:

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2017		Provision		Charge-Offs		Recoveries		3/31/2017		3/31/2017		of receivables
Short-term consumer loans	$	2,223	$	6,433	$	(19,134)	$	12,324	$	1,846	$	51,325	3.60	%
Medium-term consumer loans		13,996		7,221		(11,979)		1,925		11,163		41,185	27.10	%
	$	16,219	$	13,654	$	(31,113)	$	14,249	$	13,009	$	92,510	14.06	%

The provision for loan losses for the three months ended March 31, 2017, also includes losses from returned items from check cashing of $1,399.

The provision for short-term consumer loans of $6,433 is net of debt sales of $89 for the three months ended March 31, 2017.

The provision for medium-term consumer loans of $7,221 is net of debt sales of $375 for the three months ended March 31, 2017.

The provision and subsequent charge off related to troubled debt restructurings totaled $13 and is included in the provision for medium-term consumer loans for the three months ended March 31, 2017. For these loans evaluated for impairment, there were no payment defaults during the three months ended March 31, 2017. The troubled debt restructurings during the three months ended March 31, 2017 are subject to an allowance of $5 with a net carrying value of $15 at March 31, 2017.

The Company has subsidiaries that facilitate third-party lender loans. Changes in the accrual for third-party lender losses for the three months ended March 31, 2018, and 2017 were as follows:

	Three Months Ended March 31,
	2018		2017
Short-term balance, beginning of period	$	4,570	$	2,907
Provision for loan losses		4,938		4,428
Charge-offs, net		(5,928)		(4,764)
Short-term balance, end of period	$	3,580	$	2,571
Medium-term balance, beginning of period	$	248	$	192
Provision for loan losses		79		59
Charge-offs, net		(139)		(131)
Medium-term balance, end of period	$	188	$	120
Total balance, beginning of period	$	4,818	$	3,099
Provision for loan losses		5,017		4,487
Charge-offs, net		(6,067)		(4,895)
Total balance, end of period	$	3,768	$	2,691

Total gross finance receivables for which the Company has recorded an accrual for third‑party lender losses totaled $29,575 and $36,967 at March 31, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off‑balance sheet arrangement.  The total gross finance receivables consist of $28,646 and $35,801 in short-term and $929 and $1,166 in medium-term loans at March 31, 2018 and December 31,2017, respectively. The provision for third party lender losses of $5,017 for the three months ending March 31, 2018 is net of debt sales of $210. The provision for third party lender losses of $4,487 for the three months ending March 31, 2017 is net of debt sales of $181, respectively.

The Company was required to purchase $16,840 and $11,568 of short-term loans and $199 and $204 of medium-term loans as part of the CSO Program during the three months ended March 31, 2018 and 2017, respectively. As these loans were in default when purchased, they met the Company’s policy and were fully charged-off at acquisition. The Company recognized recoveries of $11,279 and $7,146 of short-term and $59 and $73 of medium-term collections on these loans  during the three months ended March 31, 2018 and 2017, respectively.

The Company considers the near term repayment performance of finance receivables as its primary credit quality indicator. The Company performs credit checks through consumer reporting agencies on certain borrowers. If a third-party lender provides the advance, the applicable third‑party lender decides whether to approve the loan and establishes all of the underwriting criteria and terms, conditions, and features of the customer’s loan agreement.

The aging of receivables at March 31, 2018, and December 31, 2017, were as follows:

	March 31, 2018				December 31, 2017
Current finance receivables	$	81,847	92.0	%	$	101,102	89.2	%
Past due finance receivables (1 - 30 days)
Short-term consumer loans		1,280	1.4	%		2,046	1.8	%
Medium-term consumer loans		2,575	2.9	%		6,502	5.7	%
Total past due finance receivables (1 - 30 days)		3,855	4.3	%		8,548	7.5	%
Past due finance receivables (31 - 60 days)
Medium-term consumer loans		2,588	2.9	%		3,130	2.8	%
Total past due finance receivables (31 - 60 days)		2,588	2.9	%		3,130	2.8	%
Past due finance receivables (61 - 90 days)
Medium-term consumer loans		685	0.8	%		588	0.5	%
Total past due finance receivables (61 - 90 days)		685	0.8	%		588	0.5	%
Total delinquent		7,128	8.0	%		12,266	10.8	%
	$	88,975	100.0	%	$	113,368	100.0	%

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Related Party Transactions and Balances

3 Months Ended

Mar. 31, 2018

Related Party Transactions and Balances

Related Party Transactions and Balances

Note 3. Related Party Transactions and Balances

There were no new significant related party transactions, or material changes to existing related party transactions, during the three months ended March 31, 2018.

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Goodwill and Other Intangible Assets

3 Months Ended

Mar. 31, 2018

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Note 4. Other Intangible Assets

Intangible amortization expense for the three months ended March 31, 2018, and 2017 was $123 and $124, respectively. There were no additional significant changes to other intangible assets during the three months ended March 31, 2018.

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Pledged Assets and Debt

3 Months Ended

Mar. 31, 2018

Pledged Assets and Debt

Pledged Assets and Debt

Note 5. Pledged Assets and Debt

Lines of credit at March 31, 2018 and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$47,000 Revolving credit, secured, interest rate as defined below, due April 2019, collateralized by all Guarantor Company assets	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129
		47,000		4,201		42,799		47,000		1,871		45,129
Less current maturities		—		—		—		—		—		—
Long-term portion	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129

The interest rate is set at three-month LIBOR plus 11%, and there is an exit fee for early termination of the facility. The 3-month LIBOR was 2.31% and 1.69% at March 31, 2018 and December 31, 2017, respectively, and the prime rate was 4.75% and 4.50% at March 31, 2018 and December 31, 2017, respectively.

On March 30, 2018, the Company amended its revolving credit facility with Victory Park Management, LLC, as administrative agent, and certain of its affiliates as lenders, which we refer to collectively as VPC, to extend the maturity date to April 4, 2019. The amendment also waived certain events of default, eliminated the obligation to satisfy a quarterly fixed charge coverage test and added covenants addressing daily minimum liquidity and asset coverage tests, weekly operational reporting requirements and monthly EBITDA and borrowing base coverage tests. Additionally, the Company is required to use commercially reasonable efforts to obtain reasonably satisfactory modification of the 2019 and 2020 Notes.

Senior secured notes payable at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$395,000 Senior Note payable, 10.75 %, collateralized by all  Guarantor Company assets, semi-annual interest payments with principal due May 2019	$	237,290	$	1,222	$	236,068	$	237,290	$	1,504	$	235,786
$25,000 Senior Note payable, 12.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2020		12,500		143		12,357		12,500		160		12,340
		249,790		1,365		248,425		249,790		1,664		248,126
Less current maturities		—		—		—		—		—		—
Long-term portion	$	249,790	$	1,365	$	248,425	$	249,790	$	1,664	$	248,126

Subsidiary notes payable at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$60,000 Note, secured, 16.75%, collateralized by acquired loans, due April 2019	$	60,000	$	2,191	$	57,809	$	60,000	$	744	$	59,256
$1,425 Term note, secured, 4.25%, collateralized by financed asset, due July 2019		867		4		863		882		5		877
$1,165 Term note, secured, 4.50%, collateralized by financed asset, due May 2021		1,061		13		1,048		1,076		14		1,062
		61,928		2,208		59,720		61,958		763		61,195
Less current maturities		121		1		120		119		1		118
Long-term portion	$	61,807	$	2,207	$	59,600	$	61,839	$	762	$	61,077

On March 30, 2018, the $60,000 Note was further amended to extend the maturity date to April 4, 2019. The amendment increases the administrative fee to 0.95% and permits an additional extension of the facility maturity date to April 2021 if certain conditions are met. The amendment allows for additional short term loans within the borrowing base and includes additional covenants addressing daily minimum cash and asset coverage tests, dividend limits, weekly operational reporting requirements, borrowing base reporting and a monthly consolidated EBITDA test.

Liquidity and Need for Additional Capital

The Company’s cash balance of $89,694 as of March 31, 2018, plus cash from operating activities, is expected to be sufficient to fund the Company’s operations through the first quarter of 2019. However, $237,290 of senior notes, $47,000 of revolving credit facility debt, and $60,000 in subsidiary notes are due in the second quarter of 2019. The Company’s expected cash position will not be sufficient to repay this indebtedness as it becomes due and the Company will need to restructure or refinance this indebtednessand there can be no assurances as to the ability of the Company to conclude such a restructuring or refinancing. These factors raise substantial doubt regarding the Company’s ability to meet its obligations and continue as a going concern for the period which extends one-year from the issuance of these financial statements.

While the Company is currently engaged in negotiations with its largest bondholders, the success of such negotiations cannot be assured.  Any inability to reach an agreement with existing debt holders, secure sufficient refinancing sources for our pending debt maturities and/or our inability to continue as a going concern could have a significant and material adverse effect on the Company, its operations and its investors and, in particular, could significantly impair recoveries by our investors under our existing indebtedness.  It is unlikely that the Company’s assets, in any event, would be sufficient to satisfy its current debt obligations.  See Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017 for more information on how these contingences could negatively impact the Company and its debt holders.

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Accounts Payable and Accrued Liabilities

3 Months Ended

Mar. 31, 2018

Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities

Note 6. Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities at March 31, 2018, and December 31, 2017, consisted of the following:

	March 31,		December 31,
	2018		2017
Accounts payable	$	3,477	$	5,465
Accrued payroll and compensated absences		6,316		7,718
Wire transfers payable		1,502		2,238
Accrual for third-party losses		3,768		4,818
Unearned CSO Fees		6,620		8,029
Deferred rent		791		867
Bill payment service liability		2,036		2,604
Lease termination		1,727		1,978
Other		5,566		5,849
	$	31,803	$	39,566

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Operating and Capital Lease Commitments and Total Rental Expense

3 Months Ended

Mar. 31, 2018

Operating and Capital Lease Commitments and Total Rental Expense

Operating and Capital Lease Commitments and Total Rental Expense

Note 7. Operating and Capital Lease Commitments and Total Rental Expense

Rental expense, including common area maintenance and real estate tax expense, totaled $6,660 and $7,034 for the three months ended March 31, 2018, and 2017, respectively.

The Company closed its Utah facility during the three months ended March 31, 2017, resulting in lease termination expense of $1,762 which is disclosed on the consolidated statement of operations

There were no additional significant changes to operating and capital lease commitments during the three months ended March 31, 2018.

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Concentrations of Credit Risks

3 Months Ended

Mar. 31, 2018

Concentrations of Credit Risks

Concentrations of Credit Risks

Note 8. Concentrations of Credit Risks

The Company’s portfolio of finance receivables is comprised of loan agreements with customers living in thirty three states and consequently such customers’ ability to honor their contracts may be affected by economic conditions in those states. Additionally, the Company is subject to regulation by federal and state governments that affect the products and services provided by the Company. To the extent that laws and regulations are passed that affect the Company’s ability to offer loans or similar products in any of the states in which it operates, the Company’s financial position could be adversely affected.

The following table summarizes the allocation of the portfolio balance by state at March 31, 2018, and December 31, 2017:

	March 31, 2018				December 31, 2017
	Balance		Percentage of		Balance		Percentage of
State	Outstanding		Total Outstanding		Outstanding		Total Outstanding
Alabama	$	10,001	11.2	%	$	12,808	11.3	%
Arizona		9,935	11.2			11,994	10.6
California		31,290	35.2			39,835	35.1
Mississippi		5,864	6.6			7,409	6.5
Virginia		10,152	11.4			12,018	10.6
Other retail segment states		14,685	16.5			19,696	17.4
Other internet segment states		7,048	7.9			9,608	8.5
Total	$	88,975	100.0	%	$	113,368	100.0	%

The other retail segment states are:  Florida, Indiana, Kentucky, Michigan, Ohio, Oregon, and Tennessee.

The other internet segment states are: Alabama, Alaska, California, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Kansas, Louisiana, Maine, Minnesota, Mississippi, Missouri, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming.

The Company offers a CSO product in Ohio and Texas to assist consumers in obtaining credit with unaffiliated third-party lenders. Total gross finance receivables for which the Company has recorded an accrual for third-party lender losses totaled $29,575 and $36,967 at March 31, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off-balance sheet arrangement. The total gross finance receivables consist of $28,646 and $35,801 in short-term and $929 and $1,166 in medium-term loans at March 31, 2018, and December 31, 2017, respectively.

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Contingencies

3 Months Ended

Mar. 31, 2018

Contingencies

Contingencies

Note 9. Contingencies

From time‑to‑time the Company is a defendant in various lawsuits and administrative proceedings wherein certain amounts are claimed or violations of law or regulations are asserted. In the opinion of the Company’s management, these claims are without substantial merit and should not result in judgments which in the aggregate would have a material adverse effect on the Company’s financial statements.

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Stock Based Compensation

3 Months Ended

Mar. 31, 2018

Stock Based Compensation

Stock Based Compensation

Note 10. Stock Based Compensation

During the three months ended March 31, 2018, the Company issued 76,559 options with a per share exercise price of $1.00 with the options vesting on specific dates defined in the award agreements.

The following weighted average assumptions were used by the Company for awards granted during the three months ended March 31, 2018:

	2018
Risk‑free interest rate		1.76%
Dividend yield		0.00%
Expected volatility		150.00%
Expected term (years)		1.00
Weighted average fair value of options granted	$	—

Stock-based compensation costs for the three months ended March 31, 2018, and 2017 were $8 and $32, respectively. As of March 31, 2018, and December 31, 2017, unrecognized stock-based compensation costs to be recognized over future periods approximated $58 and $66, respectively. At March 31, 2018, the remaining unrecognized compensation expense was $58 for certain awards that vest over the requisite service period. The remaining compensation expense of $58 is expected to be recognized over a weighted-average period of 1.8 years. The total income tax benefit recognized in the income statement for the stock-based compensation arrangements was $2 and $9 for the three months ended March 31, 2018, and 2017, respectively.

Stock option activity for the three months ended March 31, 2018, is as follows (these amounts have not been rounded in thousands):

		Weighted-Average				Aggregate
		ExercisePrice		Weighted-Average		Intrinsic
		(actual per		Remaining		Value
	Shares	share price)		ContractualTerm		(thousands)
Outstanding at December 31, 2017	1,332,632	$	2.25		8.5		N/A
Granted	76,559		1.00		8.3		N/A
Exercised	—		—		—		N/A
Forfeited or expired	—		—		—		N/A
Outstanding at March 31, 2018	1,409,191	$	2.18		8.3		N/A
Exercisable at March 31, 2018	1,277,737	$	2.25		8.2	$	—
Vested or expected to vest at March 31, 2018	1,409,191	$	2.18		8.3	$	—

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Business Segments

3 Months Ended

Mar. 31, 2018

Business Segments

Business Segments

Note 11. Business Segments

The Company has elected to organize and report on its operations as two operating segments: Retail financial services and Internet financial services.

The following tables present summarized financial information for the Company’s segments:

	As of and for the three months ended March 31, 2018
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	166,505			$	37,511					$	204,016
Other Intangible Assets		336				466						802
Total Revenues	$	72,797	100.0	%	$	14,854	100.0	%			$	87,651	100.0	%
Provision for Loan Losses		15,620	21.4	%		7,015	47.2	%				22,635	25.8	%
Other Operating Expenses		36,291	49.9	%		1,540	10.4	%				37,831	43.2	%
Operating Gross Profit		20,886	28.7	%		6,299	42.4	%				27,185	31.0	%
Interest Expense, net		9,479	13.0	%		2,699	18.2	%				12,178	13.9	%
Depreciation and Amortization		1,000	1.4	%		93	0.6	%				1,093	1.3	%
Other Corporate Expenses (a)		—	—			—	—			17,602		17,602	20.1	%
Income (Loss) from Continuing Operations, before tax		10,407	14.3	%		3,507	23.6	%		(17,602)		(3,688)	(4.2)	%

(a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

	As of and for the three months ended March 31, 2017
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	309,595			$	57,106					$	366,701
Goodwill		113,256				—						113,256
Other Intangible Assets		488				800						1,288
Total Revenues	$	68,691	100.0	%	$	16,661	100.0	%			$	85,352	100.0	%
Provision for Loan Losses		12,058	17.6	%		7,482	44.9	%				19,540	22.9	%
Other Operating Expenses		38,207	55.6	%		1,009	6.1	%				39,216	45.9	%
Operating Gross Profit		18,426	26.8	%		8,170	49.0	%				26,596	31.2	%
Interest Expense, net		7,366	10.7	%		4,005	24.0	%				11,371	13.3	%
Depreciation and Amortization		1,129	1.6	%		180	1.1	%				1,309	1.5	%
Lease termination Expenses		—	—	%		1,762	10.6	%				1,762	2.1	%
Other Corporate Expenses (a)		—	—			—	—			20,186		20,186	23.7	%
Income (loss) from Continuing Operations, before tax		9,931	14.5	%		2,223	13.3	%		(20,186)		(8,032)	(9.4)	%

(a)Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

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Income Taxes

3 Months Ended

Mar. 31, 2018

Income Taxes

Income Taxes

Note 12. Income Taxes

The Company files a consolidated federal income tax return. The Company files consolidated or separate state income tax returns as permitted by the individual states in which it operates. The differences between our effective rate and the U.S. statutory rate is primarily due to non-deductible expenses, state taxes, and changes in valuation allowance. The Company had no liability recorded for unrecognized tax benefits at March 31, 2018, and December 31, 2017.

At March 31, 2018, the Company had gross deferred tax assets of $72,877 and a valuation allowance of $72,877. At December 31, 2017, the Company had gross deferred tax assets of $71,896 and a valuation allowance of $71,896. The Company maintains a full valuation allowance against its deferred tax assets as it is more likely than not that the deferred tax assets will not be realized. In evaluating whether a valuation allowance is needed for the deferred tax assets, the Company considered the ability to carry net operating losses back to prior periods, reversing taxable temporary differences, and estimates of future taxable income. There have been no credits or net operating losses that have expired. The projections were evaluated in light of past operating results and considered the risks associated with generating future taxable income due to macroeconomic conditions in the markets in which the Company operates, regulatory developments and cost containment. The Company will continue to evaluate the need for a valuation allowance against deferred tax assets in future periods and will adjust the allowance as necessary if it determines that it is more likely than not that some or all of the deferred tax assets will be realized.

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Transactions with Variable Interest Entities

3 Months Ended

Mar. 31, 2018

Transactions with Variable Interest Entities

Transactions with Variable Interest Entities

Note 13. Transactions with Variable Interest Entities

The Company has limited agency agreements with unaffiliated third-party lenders. The agreements govern the terms by which the Company refers customers to that lender, on a non-exclusive basis, for a possible extension of credit, processes loan applications, and commits to reimburse the lender for any loans or related fees that were not collected from such customers. As of March 31, 2018, and December 31, 2017, the outstanding amount of active consumer loans guaranteed by the Company, which represents the Company’s maximum exposure, was $29,575 and $36,967, respectively. The outstanding amount of consumer loans with unaffiliated third-party lenders consist of $28,646 and $35,801 in short-term and $929 and $1,166 in installment loans at March 31, 2018, and December 31, 2017, respectively. The accrual for third party lender losses related to these obligations totaled $3,768 and $4,818 as of March 31, 2018, and December 31, 2017, respectively. This obligation is recorded as a current liability on the Company’s consolidated balance sheet. The Company has determined that the lenders are Variable Interest Entities (“VIEs”) but that the Company is not the primary beneficiary of the VIEs. Therefore, the Company has not consolidated either lender.

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Supplemental Guarantor Information

3 Months Ended

Mar. 31, 2018

Supplemental Guarantor Information

Supplemental Guarantor Information

Note 14. Supplemental Guarantor Information

The 2019 notes and the 2020 notes contain various covenants that, subject to certain exceptions defined in the indentures governing the notes (the “Indentures”), limit the Company’s ability to, among other things, engage in certain transactions with affiliates, pay dividends or distributions, redeem or repurchase capital stock, incur or assume liens or additional debt, and consolidate or merge with or into another entity or sell substantially all of its assets. The Company has optional redemption features on the 2019 notes and the 2020 notes prior to their maturity which, depending on the date of the redemption, would require premiums to be paid in addition to all principal and interest due.

The 2019 notes and 2020 notes are guaranteed by all of the Company’s guarantor subsidiaries existing as of April 29, 2011 (the date the Company issued the 2019 notes) and any subsequent guarantor subsidiaries that guarantee the Company’s indebtedness or the indebtedness of any other subsidiary guarantor (the “Subsidiary Guarantors”), in accordance with the Indentures. The Company is a holding company and has no independent assets or operations of its own. The guarantees under the 2019 notes and 2020 notes are full, unconditional, and joint and several. There are no restrictions on the ability of the Company or any of the Subsidiary Guarantors to obtain funds from its restricted subsidiaries by dividend or loan, except for net worth requirements of certain states in which the Company operates. Certain Subsidiary Guarantors are required to maintain net worth ranging from $10 to $2,000. The total net worth requirements of these Subsidiary Guarantors is $4,610. The Indentures contain certain affirmative and negative covenants applicable to the Company and its Subsidiary Guarantors, including restrictions on their ability to incur additional indebtedness, consummate certain asset sales, make investments in certain entities that create liens on their assets, enter into certain affiliate transactions and make certain restricted payments, including restrictions on the Company’s ability to pay dividends on, or repurchase, its common stock.

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information

3 Months Ended

Mar. 31, 2018

Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information

Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information

Note 15. Supplemental Condensed Consolidating Guarantor and Non‑Guarantor Financial Information

The following presents the condensed consolidating guarantor financial information as of March 31, 2018, and December 31, 2017, and for the three months ended March 31, 2018, and 2017, for the subsidiaries of the Company that serve as guarantors of the 2019 notes and the 2020 notes, and for the subsidiaries that do not serve as a guarantor. As of March 31, 2018, the non-guarantor subsidiaries are CCFI Funding LLC and CCFI Funding II LLC. During or prior to the first quarter of 2017, the following non-guarantor subsidiaries were dissolved; Direct Financial Solutions of UK Limited and its subsidiary Cash Central UK Limited, Direct Financial Solutions of Canada, Inc and its subsidiaries DFS-CC Financial Services LLC, DFS-CC Financial Services (Calgary) LLC and DFS-CC Financial Services (Toronto) LLC,

and Direct Financial Solutions of Australia Pty Ltd and its subsidiary Cash Central of Australia Pty Ltd. The UK,

Canada, and Australia entities, and their subsidiaries. The Florida II non-guarantor subsidiary was sold on February 1,

2016. Each of the Company’s guarantor subsidiaries are 100% owned by the Company or its subsidiaries, and all guarantees are full, unconditional, and joint and several. 

Of the entities under “Non-Guarantor Subsidiaries” in the tables below, Florida II, CCFI Funding, and CCFI Funding II are “Unrestricted Subsidiaries” as defined in the Indentures. Buckeye Check Cashing of Florida II, LLC was acquired on July 31, 2012, and was sold on February 1, 2016, CCFI Funding was created on December 20, 2013, and CCFI Funding II was established on September 19, 2014. Refer to the “Non-Guarantor Subsidiaries” columns in the following condensed consolidating schedules. The remainder of the entities included under “Non-Guarantor Subsidiaries” in the tables below are “Restricted Subsidiaries” as defined in the Indentures governing the 2019 notes and the 2020 notes and, for the periods specified, did not have material assets, liabilities, revenue or expenses.

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets (unaudited)

March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	63,751	$	21,523	$	—	$	85,274
Restricted cash		—		4,420		—		—		4,420
Finance receivables, net		—		20,859		47,427		—		68,286
Card related pre-funding and receivables		—		841		—		—		841
Other current assets		—		22,161		9,655		(18,294)		13,522
Total current assets		—		112,032		78,605		(18,294)		172,343
Noncurrent Assets
Investment in Subsidiaries		365,365		—		—		(365,365)		—
Finance receivables, net		—		3,626		—		—		3,626
Property, leasehold improvements and equipment, net		—		24,816		—		—		24,816
Other intangible assets		—		802		—		—		802
Security deposits		—		2,429		—		—		2,429
Total assets	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	25,761	$	14,251	$	(8,209)	$	31,803
Money orders payable		—		8,024		—		—		8,024
Accrued interest		11,937		5		4,232		(4,232)		11,942
Current portion of capital lease obligation		—		160		—		—		160
Current portion of subsidiary note payable		—		120		—		—		120
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		11,937		36,605		24,336		(18,294)		54,584
Noncurrent Liabilities
Lease termination payable		—		569		—		—		569
Lines of credit		42,799		—		—		—		42,799
Subsidiary note payable		—		1,791		57,809		—		59,600
Senior secured notes		248,425		—		—		—		248,425
Deferred revenue		—		6,887		—		—		6,887
Total liabilities		303,161		45,852		82,145		(18,294)		412,864
Stockholders' Equity (Deficit)		62,204		97,853		(3,540)		(365,365)		(208,848)
Total liabilities and stockholders' equity	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	57,526	$	9,101	$	—	$	66,627
Restricted cash		—		4,585		—		—		4,585
Finance receivables, net		—		47,221		42,486		—		89,707
Card related pre-funding and receivables		—		1,062		—		—		1,062
Other current assets		—		39,604		17,951		(42,284)		15,271
Total current assets		—		149,998		69,538		(42,284)		177,252
Noncurrent Assets
Investment in Subsidiaries		360,599		—		—		(360,599)		—
Finance receivables, net		—		4,632		—		—		4,632
Property, leasehold improvements and equipment, net		—		26,848		—		—		26,848
Other intangible assets		—		924		—		—		924
Security deposits		—		2,750		—		—		2,750
Total assets	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	57,696	$	14,364	$	(32,494)	$	39,566
Money orders payable		—		7,169		—		—		7,169
Accrued interest		5,140		5		3,937		(3,937)		5,145
Current portion of capital lease obligation		—		371		—		—		371
Current portion of subsidiary note payable		—		118		—		—		118
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		5,140		67,894		24,154		(42,284)		54,904
Noncurrent Liabilities
Lease termination payable		—		818		—		—		818
Lines of credit		45,129		—		—		—		45,129
Subsidiary note payable		—		1,821		59,256		—		61,077
Senior secured notes		248,126		—		—		—		248,126
Deferred Revenue		—		7,520		—		—		7,520
Total liabilities		298,395		78,053		83,410		(42,284)		417,574
Stockholders' Equity (Deficit)		62,204		107,099		(13,872)		(360,599)		(205,168)
Total liabilities and stockholders' equity	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	22,863	$	28,069	$	—	$	50,932
Credit service fees		—		19,196		—		—		19,196
Check cashing fees		—		11,692		—		—		11,692
Card fees		—		1,948		—		—		1,948
Other		—		3,885		293		(295)		3,883
Total revenues		—		59,584		28,362		(295)		87,651
Operating expenses:
Salaries		—		17,132		—		—		17,132
Provision for loan losses		—		9,205		13,430		—		22,635
Occupancy		—		6,343		—		—		6,343
Advertising and marketing		—		1,011		—		—		1,011
Lease termination costs		—		97		—		—		97
Depreciation and amortization		—		2,223		—		—		2,223
Other		—		11,025		—		—		11,025
Total operating expenses		—		47,036		13,430		—		60,466
Operating gross profit		—		12,548		14,932		(295)		27,185
Corporate expenses		—		17,490		112		—		17,602
Intercompany management fee		—		(1,385)		1,385		—		—
Depreciation and amortization		—		1,093		—		—		1,093
Interest expense, net		9,367		124		2,982		(295)		12,178
Interest expense allocation		(9,367)		9,367		—		—		—
Total corporate and other expenses		—		26,689		4,479		(295)		30,873
Income (loss) before income taxes		—		(14,141)		10,453		—		(3,688)
Provision for income taxes		—		—		—		—		—
Net income (loss)	$	—	$	(14,141)	$	10,453	$	—	$	(3,688)

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	39,830	$	9,221	$	—	$	49,051
Credit service fees		—		18,139		—		—		18,139
Check cashing fees		—		12,126		—		—		12,126
Card fees		—		2,007		—		—		2,007
Dividend		—		3,000		—		(3,000)		—
Other		—		4,275		49		(295)		4,029
Total revenues		—		79,377		9,270		(3,295)		85,352
Operating expenses:
Salaries		—		17,273		—		—		17,273
Provision for loan losses		—		16,458		3,082		—		19,540
Occupancy		—		6,629		—		—		6,629
Advertising and marketing		—		814		—		—		814
Lease termination costs		—		47		—		—		47
Depreciation and amortization		—		2,538		—		—		2,538
Other		—		11,914		1		—		11,915
Total operating expenses		—		55,673		3,083		—		58,756
Operating gross profit		—		23,704		6,187		(3,295)		26,596
Corporate expenses		—		20,095		91		—		20,186
Intercompany management fee		—		(427)		427		—		—
Lease termination		—		1,762		—		—		1,762
Depreciation and amortization		—		1,309		—		—		1,309
Interest expense, net		9,023		195		2,448		(295)		11,371
Interest expense allocation		(9,023)		9,023		—		—		—
Total corporate and other expenses		—		31,957		2,966		(295)		34,628
Income (loss) before income taxes		—		(8,253)		3,221		(3,000)		(8,032)
Provision for (benefit from) income taxes		—		342		(134)		125		333
Net income (loss)	$	—	$	(8,595)	$	3,355	$	(3,125)	$	(8,365)

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by (used in) operating activities	$	2,762	$	(10,588)	$	32,415	$	24,589
Cash flows from investing activities
Net receivables repaid (originated)		—		18,163		(18,371)		(208)
Purchase of leasehold improvements and equipment		—		(1,274)		—		(1,274)
Net cash provided by (used in) investing activities		—		16,889		(18,371)		(1,482)
Cash flows from financing activities
Payments on subsidiary note		—		(30)		—		(30)
Payments on capital lease obligations		—		(211)		—		(211)
Debt issuance costs		(2,762)		—		(1,622)		(4,384)
Net cash used in financing activities		(2,762)		(241)		(1,622)		(4,625)
Net increase in cash and cash equivalents and restricted cash		—		6,060		12,422		18,482
Cash and cash equivalents and restricted cash:
Beginning		—		62,111		9,101		71,212
Ending	$	—	$	68,171	$	21,523	$	89,694

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by operating activities	$	—	$	16,121	$	6,079	$	22,200
Cash flows from investing activities
Net receivables repaid (originated)		—		(5,830)		3,109		(2,721)
Purchase of leasehold improvements and equipment		—		(1,001)		—		(1,001)
Net cash provided by (used in) investing activities		—		(6,831)		3,109		(3,722)
Cash flows from financing activities
Payments on subsidiary note		—		(29)		—		(29)
Payments on capital lease obligations, net		—		(248)		—		(248)
Payments on lines of credit		—		(2,250)		—		(2,250)
Net cash used in financing activities		—		(2,527)		—		(2,527)
Net increase in cash and cash equivalents and restricted cash		—		6,763		9,188		15,951
Cash and cash equivalents and restricted cash:
Beginning		—		74,792		34,556		109,348
Ending	$	—	$	81,555	$	43,744	$	125,299

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Ownership, Nature of Business, and Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2018

Ownership, Nature of Business, and Significant Accounting Policies

Basis of presentation

Basis of presentation:  The accompanying interim unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10‑Q and accounting principles generally accepted in the United States (“GAAP”) for interim financial information. They do not include all information and footnotes required by GAAP for complete financial statements. Although management believes that the disclosures are adequate to prevent the information from being misleading, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2017, included in the Company’s Annual Report on Form 10‑K filed with the Securities & Exchange Commission on April 2, 2018. All adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial condition, have been included. The results for any interim period are not necessarily indicative of results to be expected for the year ending December 31, 2018.

Basis of consolidation

Basis of consolidation:  The accompanying consolidated financial statements include the accounts of CCFI. All significant intercompany accounts and transactions have been eliminated in consolidation.

Business segments

Business segments:  FASB Accounting Standards Codification (“ASC”) Topic 280 Segment Reporting requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way operating segments were determined and other items. The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in determining how to allocate resources and assess performance. The Company operates in two segments: Retail financial services and Internet financial services.

Equity Method Investments

Equity method investments:    Entities and investments over which the Company exercises significant influence over the activities of the entity but which do not meet the requirements for consolidation are accounted for using the equity method of accounting pursuant to ASC 323, whereby the Company records its share of the underlying income or loss of these entities. Intercompany profit arising from transactions with affiliates is eliminated to the extent of its beneficial interest. Equity in losses of equity method investments is not recognized after the carrying value of an investment, including advances and loans, has been reduced to zero, unless guarantees or other funding obligations exist.

On September 30, 2017, the Company entered into a joint venture with a third party to offer insurance products through select retail locations in a certain market. The joint venture will be managed by the third party.

Revenue recognition

Revenue recognition:  Transactions include loans, credit service fees, check cashing, bill payment, money transfer, money order sales, and other miscellaneous products and services. The full amount of the check cashing fee is recognized as revenue at the time of the transaction. Fees and direct costs incurred for the origination of loans are deferred and amortized over the loan period using the interest method. The Company acts in an agency capacity regarding bill payment services, money transfers, card products, and money orders offered and sold at its retail locations. The Company records the net amount retained as revenue because the supplier is the primary obligor in the arrangement, the amount earned by the Company is fixed, and the supplier is determined to have the ultimate credit risk. Revenue on loans determined to be troubled debt restructurings are recognized at the impaired loans’ original interest rates until the impaired loans are charged off or paid by the customer. Credit service organization (“CSO”) fees are recognized over the arranged credit service period.

Finance receivables

Finance receivables:  Finance receivables consist of short term and medium‑term consumer loans.

Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term loan products typically range in principal from $100 to $1,000, with a maturity between fourteen and thirty days, and include a written agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations, which vary by state. State statutes vary from charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advance by making cash payments or allowing a check or preauthorized debit to be presented. Secured consumer loans with a maturity of ninety days or less are included in this category and represented 14.0% and 14.5% of short-term consumer loans at March 31, 2018 and December 31, 2017, respectively.

Medium-term consumer loans can be unsecured or secured with a maturity greater than ninety days and up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000, and are evidenced by a promissory note with a maturity between three and thirty-six months. These consumer loans vary in structure depending upon the applicable laws and regulations where they are offered. The medium-term consumer loans are payable in installments or provide for a line of credit with periodic payments. Secured consumer loans with a maturity greater than ninety days are included in this category and represented 14.0% and 12.6% of medium-term consumer loans at March 31, 2018, and December 31, 2017, respectively.

Allowance for loan losses

Allowance for loan losses:  Provisions for loan losses are charged to income in amounts sufficient to maintain an adequate allowance for loan losses and an adequate accrual for losses related to guaranteed loans processed for third-party lenders under the CSO programs. The factors used in assessing the overall adequacy of the allowance for loan losses, the accrual for losses related to guaranteed loans made by third-party lenders and the resulting provision for loan losses include an evaluation by product, by market based on historical loan loss experience, and delinquency of certain medium-term consumer loans. The Company evaluates various qualitative factors that may or may not affect the computed initial estimate of the allowance for loan losses, by using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions.

For short term unsecured consumer loans, the Company’s policy is to charge off loans when they become past due. The Company’s policy dictates that, where a customer has provided a check or ACH authorization for presentment upon the maturity of a loan, if the customer has not paid off the loan by the due date, the Company will deposit the customer’s check or draft the customer’s bank account for the amount due. If the check or draft is returned as unpaid, all accrued fees and outstanding principal are charged-off as uncollectible. For short term secured loans, the Company’s policy requires that balances be charged off when accounts are either thirty or sixty days past due depending on the product.

For medium term secured and unsecured consumer loans that have a term of one year or less, the Company’s policy requires that balances be charged off when accounts are sixty days past due. For medium term secured and unsecured consumer loans that have an initial maturity of greater than one year, the Company’s policy requires that balances be charged off when accounts are ninety-one days past due.

In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. These reduced interest rates and changed payment terms were limited to loans that the Company believed the customer had the ability to pay in the foreseeable future. These loans were accounted for as troubled debt restructurings and represent the only loans considered impaired due to the nature of the Company’s charge-off policy.

Recoveries of amounts previously charged off are recorded to the allowance for loan losses or the accrual for third‑party losses in the period in which they are received.

Lease Termination Payable

Lease termination payable:  The Company records a liability in the consolidated balance sheets for the remaining lease obligations with the corresponding lease termination expense for closed retail locations disclosed in the operating expenses section, and closed corporate locations disclosed in the corporate and other expenses section, of the consolidated statements of operations, respectively.

Fair value of financial instruments

Fair value of financial instruments:  Financial assets and liabilities measured at fair value are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are:

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

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

· Level 3—Unobservable inputs for assets and liabilities reflecting the reporting entity’s own assumptions.

The Company follows the provisions of ASC 820‑10, Fair Value Measurements and Disclosures, which applies to all assets and liabilities that are being measured and reported on a fair value basis. ASC 820‑10 requires a disclosure that establishes a framework for measuring fair value within GAAP and expands the disclosure about fair value measurements. This standard enables a reader of consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The standard requires that assets and liabilities carried at fair value be classified and disclosed in one of the three categories.

In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820-10. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The Company’s financial instruments consist primarily of cash and cash equivalents, finance receivables, restricted cash, and lines of credit. For all such instruments, other than senior secured notes and notes payable at March 31, 2018, and December 31, 2017, the carrying amounts in the consolidated financial statements approximate their fair values. Finance receivables are short term in nature and are originated at prevailing market rates and lines of credit bear interest at current market rates. The fair value of finance receivables at March 31, 2018 and December 31, 2017 approximates carrying value and is measured using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. 

The fair value of the Company’s 10.75% senior secured notes due 2019 (the “2019 notes”) and the 12.75% senior secured notes due 2020 (the “2020 notes”) were determined based on market yield on trades of the 2019 notes at the end of the recent reporting period.

	March 31, 2018
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	85,274	$	85,274	1
Restricted cash		4,420		4,420	1
Finance receivables		71,912		71,912	3
Financial liabilities:
10.75% Senior secured notes		237,290		222,103	1
12.75% Senior secured notes		12,500		11,479	2
Subsidiary Note payable		61,928		61,928	2
Line of Credit		47,000		47,000	2

	December 31, 2017
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	66,627	$	66,627	1
Restricted cash		4,585		4,585	1
Finance receivables		94,339		94,339	3
Financial liabilities:
10.75% Senior secured notes		237,290		212,636	1
12.75% Senior secured notes		12,500		10,841	2
Subsidiary Note payable		61,958		61,958	2
Line of Credit		47,000		47,000	2

Treasury stock

Treasury Stock:  Treasury stock is reported at cost and consists of one million common shares at March 31, 2018 and December 31, 2017.

Recent Accounting Pronouncements

Recent Accounting Pronouncements:  In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective method. The adoption of ASC 606 did not impact the Company’s revenue recognition for consumer loan fees as these revenue streams are outside of the scope of ASC 606. Further, the Company has not identified any impacts to its consolidated financial statements that were material as a result of the adoption of ASC 606 for its CSO fees. The Company has not changed the presentation of its consolidated financial statements for assets, liabilities, or revenues from contracts with customers, nor has the Company recognized any cumulative effect adjustment as a result of the adoption of ASC 606.

In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash”. GAAP currently does not include specific guidance to address how to classify and present changes in restricted cash or restricted cash equivalents that occur when there are transfers between cash, cash equivalents, and restricted cash or restricted cash equivalents and when there are direct cash receipts into restricted cash or restricted cash equivalents or direct cash payments made from restricted cash or restricted cash equivalents. The amendments in this update require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update do not provide a definition of restricted cash or restricted cash equivalents. For public business entities the amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted the new standard effective in 2018. As a result, the Company no longer reports the changes in restricted cash as an operating activity. Instead, restricted cash is included in the beginning and ending cash and cash equivalents balances on the consolidated statements of cash flows.

Subsequent events

Subsequent events:  The Company has evaluated its subsequent events (events occurring after March 31, 2018) through the issuance date of May 14, 2018.

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Ownership, Nature of Business, and Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2018

Ownership, Nature of Business, and Significant Accounting Policies

Schedule of estimated fair values of financial instruments

	March 31, 2018
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	85,274	$	85,274	1
Restricted cash		4,420		4,420	1
Finance receivables		71,912		71,912	3
Financial liabilities:
10.75% Senior secured notes		237,290		222,103	1
12.75% Senior secured notes		12,500		11,479	2
Subsidiary Note payable		61,928		61,928	2
Line of Credit		47,000		47,000	2

	December 31, 2017
	Carrying
	Amount		Fair Value		Level
Financial assets:
Cash and cash equivalents	$	66,627	$	66,627	1
Restricted cash		4,585		4,585	1
Finance receivables		94,339		94,339	3
Financial liabilities:
10.75% Senior secured notes		237,290		212,636	1
12.75% Senior secured notes		12,500		10,841	2
Subsidiary Note payable		61,958		61,958	2
Line of Credit		47,000		47,000	2

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2018

Finance Receivables, Credit Quality Information and Allowance for Loan Losses

Schedule of finance receivables representing amounts due from customers for advances

	March 31,		December 31,
	2018		2017
Short-term consumer loans	$	52,115	$	66,465
Medium-term consumer loans		36,860		46,903
Gross receivables	$	88,975	$	113,368
Unearned advance fees, net of deferred loan origination costs		(2,260)		(2,702)
Finance receivables before allowance for loan losses		86,715		110,666
Allowance for loan losses		(14,803)		(16,327)
Finance receivables, net	$	71,912	$	94,339
Finance receivables, net
Current portion	$	68,286	$	89,707
Non-current portion		3,626		4,632
Total finance receivables, net	$	71,912	$	94,339

Schedule of changes in the allowance for loan losses by product type

XBRL-Only Conte

Note 2. Finance Receivables, Credit Quality Information and Allowance for Loan Losses

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2018		Provision		Charge-Offs		Recoveries		3/31/2018		3/31/2018		of receivables
Short-term consumer loans	$	2,697	$	8,159	$	(18,424)	$	9,886	$	2,318	$	52,115	4.45	%
Medium-term consumer loans		13,630		8,397		(11,067)		1,525		12,485		36,860	33.87	%
	$	16,327	$	16,556	$	(29,491)	$	11,411	$	14,803	$	88,975	16.64	%

nt

													Allowance as
	Balance								Balance		Receivables		a percentage
	1/1/2017		Provision		Charge-Offs		Recoveries		3/31/2017		3/31/2017		of receivables
Short-term consumer loans	$	2,223	$	6,433	$	(19,134)	$	12,324	$	1,846	$	51,325	3.60	%
Medium-term consumer loans		13,996		7,221		(11,979)		1,925		11,163		41,185	27.10	%
	$	16,219	$	13,654	$	(31,113)	$	14,249	$	13,009	$	92,510	14.06	%

Schedule of changes in the accrual for third-party lender losses

	Three Months Ended March 31,
	2018		2017
Short-term balance, beginning of period	$	4,570	$	2,907
Provision for loan losses		4,938		4,428
Charge-offs, net		(5,928)		(4,764)
Short-term balance, end of period	$	3,580	$	2,571
Medium-term balance, beginning of period	$	248	$	192
Provision for loan losses		79		59
Charge-offs, net		(139)		(131)
Medium-term balance, end of period	$	188	$	120
Total balance, beginning of period	$	4,818	$	3,099
Provision for loan losses		5,017		4,487
Charge-offs, net		(6,067)		(4,895)
Total balance, end of period	$	3,768	$	2,691

Schedule of aging of receivables

	March 31, 2018				December 31, 2017
Current finance receivables	$	81,847	92.0	%	$	101,102	89.2	%
Past due finance receivables (1 - 30 days)
Short-term consumer loans		1,280	1.4	%		2,046	1.8	%
Medium-term consumer loans		2,575	2.9	%		6,502	5.7	%
Total past due finance receivables (1 - 30 days)		3,855	4.3	%		8,548	7.5	%
Past due finance receivables (31 - 60 days)
Medium-term consumer loans		2,588	2.9	%		3,130	2.8	%
Total past due finance receivables (31 - 60 days)		2,588	2.9	%		3,130	2.8	%
Past due finance receivables (61 - 90 days)
Medium-term consumer loans		685	0.8	%		588	0.5	%
Total past due finance receivables (61 - 90 days)		685	0.8	%		588	0.5	%
Total delinquent		7,128	8.0	%		12,266	10.8	%
	$	88,975	100.0	%	$	113,368	100.0	%

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Pledged Assets and Debt (Tables)

3 Months Ended

Mar. 31, 2018

Pledged Assets and Debt

Schedule of lines of credit

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$47,000 Revolving credit, secured, interest rate as defined below, due April 2019, collateralized by all Guarantor Company assets	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129
		47,000		4,201		42,799		47,000		1,871		45,129
Less current maturities		—		—		—		—		—		—
Long-term portion	$	47,000	$	4,201	$	42,799	$	47,000	$	1,871	$	45,129

Schedule of senior secured notes payable

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$395,000 Senior Note payable, 10.75 %, collateralized by all  Guarantor Company assets, semi-annual interest payments with principal due May 2019	$	237,290	$	1,222	$	236,068	$	237,290	$	1,504	$	235,786
$25,000 Senior Note payable, 12.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2020		12,500		143		12,357		12,500		160		12,340
		249,790		1,365		248,425		249,790		1,664		248,126
Less current maturities		—		—		—		—		—		—
Long-term portion	$	249,790	$	1,365	$	248,425	$	249,790	$	1,664	$	248,126

Schedule of subsidiary note payable

	March 31, 2018						December 31, 2017
			Deferred						Deferred
			Issuance		Net				Issuance		Net
	Principal		Costs		Principal		Principal		Costs		Principal
$60,000 Note, secured, 16.75%, collateralized by acquired loans, due April 2019	$	60,000	$	2,191	$	57,809	$	60,000	$	744	$	59,256
$1,425 Term note, secured, 4.25%, collateralized by financed asset, due July 2019		867		4		863		882		5		877
$1,165 Term note, secured, 4.50%, collateralized by financed asset, due May 2021		1,061		13		1,048		1,076		14		1,062
		61,928		2,208		59,720		61,958		763		61,195
Less current maturities		121		1		120		119		1		118
Long-term portion	$	61,807	$	2,207	$	59,600	$	61,839	$	762	$	61,077

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Accounts Payable and Accrued Liabilities (Tables)

3 Months Ended

Mar. 31, 2018

Accounts Payable and Accrued Liabilities

Schedule of accounts payable and accrued liabilities

	March 31,		December 31,
	2018		2017
Accounts payable	$	3,477	$	5,465
Accrued payroll and compensated absences		6,316		7,718
Wire transfers payable		1,502		2,238
Accrual for third-party losses		3,768		4,818
Unearned CSO Fees		6,620		8,029
Deferred rent		791		867
Bill payment service liability		2,036		2,604
Lease termination		1,727		1,978
Other		5,566		5,849
	$	31,803	$	39,566

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Concentrations of Credit Risks (Tables)

3 Months Ended

Mar. 31, 2018

Concentrations of Credit Risks

Summary of allocation of portfolio balance by state

	March 31, 2018				December 31, 2017
	Balance		Percentage of		Balance		Percentage of
State	Outstanding		Total Outstanding		Outstanding		Total Outstanding
Alabama	$	10,001	11.2	%	$	12,808	11.3	%
Arizona		9,935	11.2			11,994	10.6
California		31,290	35.2			39,835	35.1
Mississippi		5,864	6.6			7,409	6.5
Virginia		10,152	11.4			12,018	10.6
Other retail segment states		14,685	16.5			19,696	17.4
Other internet segment states		7,048	7.9			9,608	8.5
Total	$	88,975	100.0	%	$	113,368	100.0	%

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Stock Based Compensation (Tables)

3 Months Ended

Mar. 31, 2018

Stock Based Compensation

Schedule of weighted average assumptions used for awards granted

The following weighted average assumptions were used by the Company for awards granted during the three months ended March 31, 2018:

	2018
Risk‑free interest rate		1.76%
Dividend yield		0.00%
Expected volatility		150.00%
Expected term (years)		1.00
Weighted average fair value of options granted	$	—

Schedule of stock option activity

Stock option activity for the three months ended March 31, 2018, is as follows (these amounts have not been rounded in thousands):

		Weighted-Average				Aggregate
		ExercisePrice		Weighted-Average		Intrinsic
		(actual per		Remaining		Value
	Shares	share price)		ContractualTerm		(thousands)
Outstanding at December 31, 2017	1,332,632	$	2.25		8.5		N/A
Granted	76,559		1.00		8.3		N/A
Exercised	—		—		—		N/A
Forfeited or expired	—		—		—		N/A
Outstanding at March 31, 2018	1,409,191	$	2.18		8.3		N/A
Exercisable at March 31, 2018	1,277,737	$	2.25		8.2	$	—
Vested or expected to vest at March 31, 2018	1,409,191	$	2.18		8.3	$	—

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Business Segment (Tables)

3 Months Ended

Mar. 31, 2018

Business Segments

Summary of financial information of segments

	As of and for the three months ended March 31, 2018
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	166,505			$	37,511					$	204,016
Other Intangible Assets		336				466						802
Total Revenues	$	72,797	100.0	%	$	14,854	100.0	%			$	87,651	100.0	%
Provision for Loan Losses		15,620	21.4	%		7,015	47.2	%				22,635	25.8	%
Other Operating Expenses		36,291	49.9	%		1,540	10.4	%				37,831	43.2	%
Operating Gross Profit		20,886	28.7	%		6,299	42.4	%				27,185	31.0	%
Interest Expense, net		9,479	13.0	%		2,699	18.2	%				12,178	13.9	%
Depreciation and Amortization		1,000	1.4	%		93	0.6	%				1,093	1.3	%
Other Corporate Expenses (a)		—	—			—	—			17,602		17,602	20.1	%
Income (Loss) from Continuing Operations, before tax		10,407	14.3	%		3,507	23.6	%		(17,602)		(3,688)	(4.2)	%

(a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

	As of and for the three months ended March 31, 2017
	Retail				Internet				Unallocated
	Financial		% of		Financial		% of		(Income)				% of
	Services		Revenue		Services		Revenue		Expenses		Consolidated		Revenue
Total Assets	$	309,595			$	57,106					$	366,701
Goodwill		113,256				—						113,256
Other Intangible Assets		488				800						1,288
Total Revenues	$	68,691	100.0	%	$	16,661	100.0	%			$	85,352	100.0	%
Provision for Loan Losses		12,058	17.6	%		7,482	44.9	%				19,540	22.9	%
Other Operating Expenses		38,207	55.6	%		1,009	6.1	%				39,216	45.9	%
Operating Gross Profit		18,426	26.8	%		8,170	49.0	%				26,596	31.2	%
Interest Expense, net		7,366	10.7	%		4,005	24.0	%				11,371	13.3	%
Depreciation and Amortization		1,129	1.6	%		180	1.1	%				1,309	1.5	%
Lease termination Expenses		—	—	%		1,762	10.6	%				1,762	2.1	%
Other Corporate Expenses (a)		—	—			—	—			20,186		20,186	23.7	%
Income (loss) from Continuing Operations, before tax		9,931	14.5	%		2,223	13.3	%		(20,186)		(8,032)	(9.4)	%

(a)Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated.

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information (Tables)

3 Months Ended

Mar. 31, 2018

Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information

Schedule of condensed consolidating balance sheet

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets (unaudited)

March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	63,751	$	21,523	$	—	$	85,274
Restricted cash		—		4,420		—		—		4,420
Finance receivables, net		—		20,859		47,427		—		68,286
Card related pre-funding and receivables		—		841		—		—		841
Other current assets		—		22,161		9,655		(18,294)		13,522
Total current assets		—		112,032		78,605		(18,294)		172,343
Noncurrent Assets
Investment in Subsidiaries		365,365		—		—		(365,365)		—
Finance receivables, net		—		3,626		—		—		3,626
Property, leasehold improvements and equipment, net		—		24,816		—		—		24,816
Other intangible assets		—		802		—		—		802
Security deposits		—		2,429		—		—		2,429
Total assets	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	25,761	$	14,251	$	(8,209)	$	31,803
Money orders payable		—		8,024		—		—		8,024
Accrued interest		11,937		5		4,232		(4,232)		11,942
Current portion of capital lease obligation		—		160		—		—		160
Current portion of subsidiary note payable		—		120		—		—		120
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		11,937		36,605		24,336		(18,294)		54,584
Noncurrent Liabilities
Lease termination payable		—		569		—		—		569
Lines of credit		42,799		—		—		—		42,799
Subsidiary note payable		—		1,791		57,809		—		59,600
Senior secured notes		248,425		—		—		—		248,425
Deferred revenue		—		6,887		—		—		6,887
Total liabilities		303,161		45,852		82,145		(18,294)		412,864
Stockholders' Equity (Deficit)		62,204		97,853		(3,540)		(365,365)		(208,848)
Total liabilities and stockholders' equity	$	365,365	$	143,705	$	78,605	$	(383,659)	$	204,016

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Current Assets
Cash and cash equivalents	$	—	$	57,526	$	9,101	$	—	$	66,627
Restricted cash		—		4,585		—		—		4,585
Finance receivables, net		—		47,221		42,486		—		89,707
Card related pre-funding and receivables		—		1,062		—		—		1,062
Other current assets		—		39,604		17,951		(42,284)		15,271
Total current assets		—		149,998		69,538		(42,284)		177,252
Noncurrent Assets
Investment in Subsidiaries		360,599		—		—		(360,599)		—
Finance receivables, net		—		4,632		—		—		4,632
Property, leasehold improvements and equipment, net		—		26,848		—		—		26,848
Other intangible assets		—		924		—		—		924
Security deposits		—		2,750		—		—		2,750
Total assets	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities	$	—	$	57,696	$	14,364	$	(32,494)	$	39,566
Money orders payable		—		7,169		—		—		7,169
Accrued interest		5,140		5		3,937		(3,937)		5,145
Current portion of capital lease obligation		—		371		—		—		371
Current portion of subsidiary note payable		—		118		—		—		118
CCFI Funding notes		—		—		5,853		(5,853)		—
Deferred revenue		—		2,535		—		—		2,535
Total current liabilities		5,140		67,894		24,154		(42,284)		54,904
Noncurrent Liabilities
Lease termination payable		—		818		—		—		818
Lines of credit		45,129		—		—		—		45,129
Subsidiary note payable		—		1,821		59,256		—		61,077
Senior secured notes		248,126		—		—		—		248,126
Deferred Revenue		—		7,520		—		—		7,520
Total liabilities		298,395		78,053		83,410		(42,284)		417,574
Stockholders' Equity (Deficit)		62,204		107,099		(13,872)		(360,599)		(205,168)
Total liabilities and stockholders' equity	$	360,599	$	185,152	$	69,538	$	(402,883)	$	212,406

Schedule of consolidated statements of operations

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	22,863	$	28,069	$	—	$	50,932
Credit service fees		—		19,196		—		—		19,196
Check cashing fees		—		11,692		—		—		11,692
Card fees		—		1,948		—		—		1,948
Other		—		3,885		293		(295)		3,883
Total revenues		—		59,584		28,362		(295)		87,651
Operating expenses:
Salaries		—		17,132		—		—		17,132
Provision for loan losses		—		9,205		13,430		—		22,635
Occupancy		—		6,343		—		—		6,343
Advertising and marketing		—		1,011		—		—		1,011
Lease termination costs		—		97		—		—		97
Depreciation and amortization		—		2,223		—		—		2,223
Other		—		11,025		—		—		11,025
Total operating expenses		—		47,036		13,430		—		60,466
Operating gross profit		—		12,548		14,932		(295)		27,185
Corporate expenses		—		17,490		112		—		17,602
Intercompany management fee		—		(1,385)		1,385		—		—
Depreciation and amortization		—		1,093		—		—		1,093
Interest expense, net		9,367		124		2,982		(295)		12,178
Interest expense allocation		(9,367)		9,367		—		—		—
Total corporate and other expenses		—		26,689		4,479		(295)		30,873
Income (loss) before income taxes		—		(14,141)		10,453		—		(3,688)
Provision for income taxes		—		—		—		—		—
Net income (loss)	$	—	$	(14,141)	$	10,453	$	—	$	(3,688)

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Income (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Revenues:
Finance receivable fees	$	—	$	39,830	$	9,221	$	—	$	49,051
Credit service fees		—		18,139		—		—		18,139
Check cashing fees		—		12,126		—		—		12,126
Card fees		—		2,007		—		—		2,007
Dividend		—		3,000		—		(3,000)		—
Other		—		4,275		49		(295)		4,029
Total revenues		—		79,377		9,270		(3,295)		85,352
Operating expenses:
Salaries		—		17,273		—		—		17,273
Provision for loan losses		—		16,458		3,082		—		19,540
Occupancy		—		6,629		—		—		6,629
Advertising and marketing		—		814		—		—		814
Lease termination costs		—		47		—		—		47
Depreciation and amortization		—		2,538		—		—		2,538
Other		—		11,914		1		—		11,915
Total operating expenses		—		55,673		3,083		—		58,756
Operating gross profit		—		23,704		6,187		(3,295)		26,596
Corporate expenses		—		20,095		91		—		20,186
Intercompany management fee		—		(427)		427		—		—
Lease termination		—		1,762		—		—		1,762
Depreciation and amortization		—		1,309		—		—		1,309
Interest expense, net		9,023		195		2,448		(295)		11,371
Interest expense allocation		(9,023)		9,023		—		—		—
Total corporate and other expenses		—		31,957		2,966		(295)		34,628
Income (loss) before income taxes		—		(8,253)		3,221		(3,000)		(8,032)
Provision for (benefit from) income taxes		—		342		(134)		125		333
Net income (loss)	$	—	$	(8,595)	$	3,355	$	(3,125)	$	(8,365)

Schedule of condensed consolidating statement of cash flows

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2018

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by (used in) operating activities	$	2,762	$	(10,588)	$	32,415	$	24,589
Cash flows from investing activities
Net receivables repaid (originated)		—		18,163		(18,371)		(208)
Purchase of leasehold improvements and equipment		—		(1,274)		—		(1,274)
Net cash provided by (used in) investing activities		—		16,889		(18,371)		(1,482)
Cash flows from financing activities
Payments on subsidiary note		—		(30)		—		(30)
Payments on capital lease obligations		—		(211)		—		(211)
Debt issuance costs		(2,762)		—		(1,622)		(4,384)
Net cash used in financing activities		(2,762)		(241)		(1,622)		(4,625)
Net increase in cash and cash equivalents and restricted cash		—		6,060		12,422		18,482
Cash and cash equivalents and restricted cash:
Beginning		—		62,111		9,101		71,212
Ending	$	—	$	68,171	$	21,523	$	89,694

Community Choice Financial Inc. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2017

	Community		Guarantor		Non‑Guarantor
	ChoiceFinancial		Subsidiaries		Subsidiaries		Consolidated
Net cash provided by operating activities	$	—	$	16,121	$	6,079	$	22,200
Cash flows from investing activities
Net receivables repaid (originated)		—		(5,830)		3,109		(2,721)
Purchase of leasehold improvements and equipment		—		(1,001)		—		(1,001)
Net cash provided by (used in) investing activities		—		(6,831)		3,109		(3,722)
Cash flows from financing activities
Payments on subsidiary note		—		(29)		—		(29)
Payments on capital lease obligations, net		—		(248)		—		(248)
Payments on lines of credit		—		(2,250)		—		(2,250)
Net cash used in financing activities		—		(2,527)		—		(2,527)
Net increase in cash and cash equivalents and restricted cash		—		6,763		9,188		15,951
Cash and cash equivalents and restricted cash:
Beginning		—		74,792		34,556		109,348
Ending	$	—	$	81,555	$	43,744	$	125,299

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Ownership, Nature of Business, and Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2018 location segment state
Nature of business
Number of retail locations owned and operated | location	484
Number of states in which stores are operated	12
Number of states in which the Company had an internet presence	30
Business Segments
Number of operating segments | segment	2

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Ownership, Nature of Business, and Significant Accounting Policies - Financing Receivables (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Medium term loans up to one year
Finance receivables
Maturity period of loan, for loan balances to be charged-off when accounts are past due by stipulated period	1 year
Period of past due when accounts are required to be charged-off	60 days
Medium term loans greater than one year
Finance receivables
Maturity period of loan, for loan balances to be charged-off when accounts are past due by stipulated period	1 year
Minimum | Secured short term loan
Finance receivables
Period of past due when accounts are required to be charged-off	30 days
Maximum | Secured short term loan
Finance receivables
Period of past due when accounts are required to be charged-off	60 days
Maximum | Medium term loans greater than one year
Finance receivables
Period of past due when accounts are required to be charged-off	91 days
Consumer Borrower | Secured short term loan
Finance receivables
Fee per $.1 borrowed (as a percent)	14.00%	14.50%
Consumer Borrower | Unsecured short term loan
Finance receivables
Interest rate on loan products (as a percent)	25.00%
Consumer Borrower | Secured Medium Term Loan
Finance receivables
Maturity period of promissory note	90 days
Fee per $.1 borrowed (as a percent)	14.00%	12.60%
Consumer Borrower | Minimum | Secured short term loan
Finance receivables
Maturity period of promissory note	90 days
Consumer Borrower | Minimum | Unsecured short term loan
Finance receivables
Consumer loan products	$ 100
Maturity period of promissory note	14 days
Fee per $.1 borrowed (as a percent)	15.00%
Consumer Borrower | Minimum | Medium-term consumer loans
Finance receivables
Maturity period of promissory note	90 days
Consumer Borrower | Minimum | Unsecured Medium Term Loan
Finance receivables
Consumer loan products	$ 100
Maturity period of promissory note	3 months
Consumer Borrower | Maximum | Short-term consumer loans
Finance receivables
Maturity period of promissory note	90 days
Consumer Borrower | Maximum | Unsecured short term loan
Finance receivables
Consumer loan products	$ 1,000
Maturity period of promissory note	30 days
Fee per $.1 borrowed (as a percent)	20.00%
Consumer Borrower | Maximum | Medium-term consumer loans
Finance receivables
Maturity period of promissory note	36 months
Consumer Borrower | Maximum | Unsecured Medium Term Loan
Finance receivables
Consumer loan products	$ 5,000
Maturity period of promissory note	36 months

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Ownership, Nature of Business, and Significant Accounting Policies - Estimated fair values of financial instruments (Details) - USD ($) $ in Thousands, shares in Millions	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Financial assets:
Restricted cash	$ 4,420	$ 4,585	$ 3,515	$ 3,015
Treasury stock.
Shares held in treasury stock	1	1
Level 1 | Carrying Amount
Financial assets:
Cash and cash equivalents	$ 85,274	$ 66,627
Restricted cash	4,420	4,585
Level 1 | Fair Value
Financial assets:
Cash and cash equivalents	85,274	66,627
Restricted cash	4,420	4,585
Level 2 | Carrying Amount
Financial liabilities:
Lines of Credit	47,000	47,000
Level 2 | Fair Value
Financial liabilities:
Lines of Credit	47,000	47,000
Level 3 | Carrying Amount
Financial assets:
Finance receivables	71,912	94,339
Level 3 | Fair Value
Financial assets:
Finance receivables	71,912	94,339
Subsidiary Note payable | Level 2 | Carrying Amount
Financial liabilities:
Notes payable	61,928	61,958
Subsidiary Note payable | Level 2 | Fair Value
Financial liabilities:
Notes payable	$ 61,928	61,958
10.75% senior secured notes due 2019 | Level 1 | Carrying Amount
Financial liabilities:
Notes payable		237,290
10.75% senior secured notes due 2019 | Level 1 | Fair Value
Financial liabilities:
Notes payable		$ 212,636
10.75% senior secured notes due 2019 | Senior secured notes payable
Estimated fair values of financial instruments
Interest rate (as a percent)	10.75%	10.75%
10.75% senior secured notes due 2019 | Senior secured notes payable | Level 1 | Carrying Amount
Financial liabilities:
Notes payable	$ 237,290
10.75% senior secured notes due 2019 | Senior secured notes payable | Level 1 | Fair Value
Financial liabilities:
Notes payable	$ 222,103
12.75% senior secured notes due 2020 | Level 2 | Carrying Amount
Financial liabilities:
Notes payable		$ 12,500
12.75% senior secured notes due 2020 | Level 2 | Fair Value
Financial liabilities:
Notes payable		$ 10,841
12.75% senior secured notes due 2020 | Senior secured notes payable
Estimated fair values of financial instruments
Interest rate (as a percent)	12.75%	12.75%
12.75% senior secured notes due 2020 | Senior secured notes payable | Level 2 | Carrying Amount
Financial liabilities:
Notes payable	$ 12,500
12.75% senior secured notes due 2020 | Senior secured notes payable | Level 2 | Fair Value
Financial liabilities:
Notes payable	$ 11,479

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Finance Receivables, Credit Quality Information and Allowance for Loan Losses
Gross receivables	$ 88,975		$ 92,510
Allowance for loan losses	(14,803)	$ (16,327)	(13,009)	$ (16,219)
Finance receivables, net	71,912	94,339
Consumer Borrower
Finance Receivables, Credit Quality Information and Allowance for Loan Losses
Gross receivables	88,975	113,368
Unearned advance fees, net of deferred loan origination costs	(2,260)	(2,702)
Finance receivables before allowance for loan losses	86,715	110,666
Allowance for loan losses	(14,803)	(16,327)
Finance receivables, net	71,912	94,339
Short-term consumer loans | Consumer Borrower
Finance Receivables, Credit Quality Information and Allowance for Loan Losses
Gross receivables	52,115	66,465	51,325
Allowance for loan losses	(2,318)	(2,697)	(1,846)	(2,223)
Medium-term consumer loans | Consumer Borrower
Finance Receivables, Credit Quality Information and Allowance for Loan Losses
Gross receivables	36,860	46,903	41,185
Allowance for loan losses	$ (12,485)	$ (13,630)	$ (11,163)	$ (13,996)

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Finance receivables (net), current and non-current portion (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Finance receivables, net
Finance receivables, net Current portion	$ 68,286	$ 89,707
Finance receivables, net Non-current portion	3,626	4,632
Finance receivables, net	$ 71,912	$ 94,339

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Changes in the allowance for the loan losses by product type (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	$ 16,327	$ 16,219
Provision	16,556	13,654
Charge-offs	(29,491)	(31,113)
Recoveries	11,411	14,249
Balance at the end of the period	14,803	13,009
Total Finance receivables at the end of the period	$ 88,975	$ 92,510
Allowance as a percentage of receivable	16.64%	14.06%
Third party lender
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	$ 4,818	$ 3,099
Provision	5,017	4,487
Charge-offs	(6,067)	(4,895)
Balance at the end of the period	3,768	2,691
Debt sales	210	181
Total gross finance receivables for which accrual for third-party lender losses has been recorded	29,575		$ 36,967
Consumer Borrower
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	16,327
Balance at the end of the period	14,803
Total Finance receivables at the end of the period	88,975		113,368
Troubled debt restructuring
Changes in the allowance for the loan losses by product type
Allowance for TDR's	6	5
Net carrying value of TDR's	14	15
Short-term consumer loans
Changes in the allowance for the loan losses by product type
Total gross finance receivables for which accrual for third-party lender losses has been recorded	28,646		35,801
Short-term consumer loans | Third party lender
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	4,570	2,907
Provision	4,938	4,428
Charge-offs	(5,928)	(4,764)
Balance at the end of the period	3,580	2,571
Short-term consumer loans | Consumer Borrower
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	2,697	2,223
Provision	8,159	6,433
Charge-offs	(18,424)	(19,134)
Recoveries	9,886	12,324
Balance at the end of the period	2,318	1,846
Total Finance receivables at the end of the period	$ 52,115	$ 51,325	66,465
Allowance as a percentage of receivable	4.45%	3.60%
Debt sales	$ 412	$ 89
Required purchases	16,840	11,568
Short-term consumer loans | Credit service program (CSO Program) | Consumer Borrower
Changes in the allowance for the loan losses by product type
Recoveries	11,279	7,146
Medium-term consumer loans
Changes in the allowance for the loan losses by product type
Total gross finance receivables for which accrual for third-party lender losses has been recorded	929		1,166
Medium-term consumer loans | Third party lender
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	248	192
Provision	79	59
Charge-offs	(139)	(131)
Balance at the end of the period	188	120
Medium-term consumer loans | Consumer Borrower
Changes in the allowance for the loan losses by product type
Balance at the beginning of the period	13,630	13,996
Provision	8,397	7,221
Charge-offs	(11,067)	(11,979)
Recoveries	1,525	1,925
Balance at the end of the period	12,485	11,163
Total Finance receivables at the end of the period	$ 36,860	$ 41,185	$ 46,903
Allowance as a percentage of receivable	33.87%	27.10%
Debt sales	$ 562	$ 375
Required purchases	199	204
Medium-term consumer loans | Troubled debt restructuring | Consumer Borrower
Changes in the allowance for the loan losses by product type
Provision and write off	20	13
Payment defaults for loans evaluated for impairment	54	0
Medium-term consumer loans | Credit service program (CSO Program) | Consumer Borrower
Changes in the allowance for the loan losses by product type
Recoveries	59	73
Check cashing | Consumer Borrower
Changes in the allowance for the loan losses by product type
Provision	$ 1,062	$ 1,399

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Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Aging of receivables (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017
Past due finance receivables
Gross receivables	$ 88,975		$ 92,510
Consumer Borrower
Aging of receivables
Current finance receivables	$ 81,847	$ 101,102
Current finance receivables (as a percent)	92.00%	89.20%
Past due finance receivables
Total past due finance receivables (1 - 30 days)	$ 3,855	$ 8,548
Total past due finance receivables (1 - 30 days) (as a percent)	4.30%	7.50%
Total past due finance receivables (31 - 60 days)	$ 2,588	$ 3,130
Total past due finance receivables (31 - 60 days) (as a percent)	2.90%	2.80%
Total past due finance receivables (61 - 90 days)	$ 685	$ 588
Total past due finance receivables (61 - 90 days) (as a percent)	0.80%	0.50%
Total delinquent	$ 7,128	$ 12,266
Total delinquent (as a percent)	8.00%	10.80%
Gross receivables	$ 88,975	$ 113,368
Gross receivables (as a percent)	100.00%	100.00%
Consumer Borrower | Short-term consumer loans
Past due finance receivables
Total past due finance receivables (1 - 30 days)	$ 1,280	$ 2,046
Total past due finance receivables (1 - 30 days) (as a percent)	1.40%	1.80%
Gross receivables	$ 52,115	$ 66,465	51,325
Consumer Borrower | Medium-term consumer loans
Past due finance receivables
Total past due finance receivables (1 - 30 days)	$ 2,575	$ 6,502
Total past due finance receivables (1 - 30 days) (as a percent)	2.90%	5.70%
Total past due finance receivables (31 - 60 days)	$ 2,588	$ 3,130
Total past due finance receivables (31 - 60 days) (as a percent)	2.90%	2.80%
Total past due finance receivables (61 - 90 days)	$ 685	$ 588
Total past due finance receivables (61 - 90 days) (as a percent)	0.80%	0.50%
Gross receivables	$ 36,860	$ 46,903	$ 41,185

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Related Party Transactions and Balances (Details)	3 Months Ended
	Mar. 31, 2018 USD ($)
Related Party Transactions and Balances
Related party transaction	$ 0

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Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Goodwill and Other Intangible Assets
Goodwill and other intangible assets	$ 0
Intangible amortization expense	$ 123	$ 124

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Pledged Assets and Debt - Line of Credit Facility (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Line of Credit Facility
Line of credit, noncurrent	$ 42,799	$ 45,129
Revolving credit due April 2019
Line of Credit Facility
Maximum borrowing capacity	47,000
Revolving credit facility
Line of Credit Facility
Principal	47,000	47,000
Principal, noncurrent	47,000	47,000
Deferred issuance costs	4,201	1,871
Deferred Issuance costs, noncurrent	4,201	1,871
Line of credit	42,799	45,129
Line of credit, noncurrent	42,799	45,129
Revolving credit facility | Revolving credit due April 2019
Line of Credit Facility
Principal	47,000	47,000
Deferred issuance costs	4,201	1,871
Line of credit	42,799	$ 45,129
Maximum borrowing capacity	$ 47,000
Prime rate
Line of Credit Facility
Interest rate at the end of period (as a percent)	4.75%	4.50%
3-Month LIBOR
Line of Credit Facility
Variable rate basis	3-month LIBOR	3-month LIBOR
Interest rate at the end of period (as a percent)	2.31%	1.69%
3-Month LIBOR | Revolving credit facility
Line of Credit Facility
Margin (as a percent)	11.00%

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Pledged Assets and Debt - Senior secured notes payable (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Senior secure notes payable
Net principal, Noncurrent	$ 248,425	$ 248,126
Senior secured notes payable
Senior secure notes payable
Deferred issuance costs	1,365	1,664
Deferred Issuance costs, noncurrent	1,365	1,664
Principal	249,790	249,790
Principal, Noncurrent	249,790	249,790
Net principal	248,425	248,126
Net principal, Noncurrent	248,425	248,126
Senior secured notes payable | 10.75% senior secured notes due 2019
Senior secure notes payable
Maximum borrowing capacity	$ 395,000
Interest rate (as a percent)	10.75%
Deferred issuance costs	$ 1,222	1,504
Principal	237,290	237,290
Net principal	$ 236,068	$ 235,786
Senior secured notes payable | 12.75% senior secured notes due 2020
Senior secure notes payable
Interest rate (as a percent)	12.75%	12.75%
Deferred issuance costs	$ 143	$ 160
Principal	12,500	12,500
Net principal	$ 12,357	$ 12,340

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Pledged Assets and Debt - Subsidiary notes payable (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 30, 2018	Dec. 31, 2017
Debt
Net principal, current	$ 120		$ 118
Net principal, noncurrent	59,600		61,077
Cash balance	89,694
Revolving credit due April 2019
Debt
Maximum borrowing capacity	47,000
Subsidiary Note payable
Debt
Principal	61,928		61,958
Principal, current	121		119
Principal, noncurrent	61,807		61,839
Deferred issuance costs	2,208		763
Deferred issuance costs, current	1		1
Deferred Issuance costs, noncurrent	2,207		762
Net principal	59,720		61,195
Net principal, current	120		118
Net principal, noncurrent	59,600		61,077
Subsidiary Note payable | Note, secured, due April 2019
Debt
Principal	60,000		60,000
Deferred issuance costs	2,191		744
Net principal	57,809		59,256
Face amount of debt	$ 60,000
Interest rate (as a percent)	16.75%
Maximum borrowing capacity		$ 60,000
Administrative fee	0.95%
Subsidiary Note payable | Term note, secured, due July 2019
Debt
Principal	$ 867		882
Deferred issuance costs	4		5
Net principal	863		877
Face amount of debt	$ 1,425
Interest rate (as a percent)	4.25%
Subsidiary Note payable | Term Note, secured, due May 2021
Debt
Principal	$ 1,061		1,076
Deferred issuance costs	13		14
Net principal	1,048		1,062
Face amount of debt	$ 1,165
Interest rate (as a percent)	4.50%
Senior secured notes payable
Debt
Deferred issuance costs	$ 1,365		1,664
Deferred Issuance costs, noncurrent	1,365		1,664
Principal	$ 249,790		$ 249,790
Senior secured notes payable | 10.75% senior secured notes due 2019
Debt
Interest rate (as a percent)	10.75%		10.75%
Principal	$ 237,290
Maximum borrowing capacity	$ 25,000

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Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Accounts Payable and Accrued Liabilities
Accounts payable	$ 3,477	$ 5,465
Accrued payroll and compensated absences	6,316	7,718
Wire transfers payable	1,502	2,238
Accrual for third-party losses	3,768	4,818
Unearned CSO fees	6,620	8,029
Deferred rent	791	867
Bill payment service liability	2,036	2,604
Lease termination	1,727	1,978
Other	5,566	5,849
Accounts payable and accrued liabilities	$ 31,803	$ 39,566

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Operating and Capital Lease Commitments and Total Rental Expense- Rental expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Operating and Capital Lease Commitments and Total Rental Expense
Rental expense, including maintenance and real estate tax expense	$ 6,660	$ 7,034
Lease termination cost		$ 1,762
Reduction in lease commitments	$ 0

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Concentrations of Credit Risks (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018 USD ($) item	Dec. 31, 2017 USD ($)
Finance receivables
Concentration of credit risks
Number of states in which customers are living | item	33
Finance receivables | Geographic concentration risk
Concentration of credit risks
Balance Outstanding	$ 88,975	$ 113,368
Percentage of Total Outstanding	100.00%	100.00%
Finance receivables | Geographic concentration risk | Alabama
Concentration of credit risks
Balance Outstanding	$ 10,001	$ 12,808
Percentage of Total Outstanding	11.20%	11.30%
Finance receivables | Geographic concentration risk | Arizona
Concentration of credit risks
Balance Outstanding	$ 9,935	$ 11,994
Percentage of Total Outstanding	11.20%	10.60%
Finance receivables | Geographic concentration risk | California
Concentration of credit risks
Balance Outstanding	$ 31,290	$ 39,835
Percentage of Total Outstanding	35.20%	35.10%
Finance receivables | Geographic concentration risk | Mississippi
Concentration of credit risks
Balance Outstanding	$ 5,864	$ 7,409
Percentage of Total Outstanding	6.60%	6.50%
Finance receivables | Geographic concentration risk | Virginia
Concentration of credit risks
Balance Outstanding	$ 10,152	$ 12,018
Percentage of Total Outstanding	11.40%	10.60%
Finance receivables | Geographic concentration risk | Other retail segment states
Concentration of credit risks
Balance Outstanding	$ 14,685	$ 19,696
Percentage of Total Outstanding	16.50%	17.40%
Finance receivables | Geographic concentration risk | Other Internet Segment States
Concentration of credit risks
Balance Outstanding	$ 7,048	$ 9,608
Percentage of Total Outstanding	7.90%	8.50%
Third party lender
Concentration of credit risks
Total gross finance receivables for which accrual for third-party lender losses has been recorded	$ 29,575	$ 36,967
Short-term consumer loans
Concentration of credit risks
Total gross finance receivables for which accrual for third-party lender losses has been recorded	28,646	35,801
Medium-term consumer loans
Concentration of credit risks
Total gross finance receivables for which accrual for third-party lender losses has been recorded	$ 929	$ 1,166

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Stock Based Compensation - (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Stock based compensation
Granted (in shares)	76,559
Granted (in dollars per share)	$ 1.00
Weighted average assumptions for options grants
Risk-free interest rate (as a percent)	1.76%
Dividend yield (as a percent)	0.00%
Expected volatility (as a percent)	150.00%
Expected term (years)	1 year
Additional disclosure
Stock-based compensation costs	$ 8	$ 32
Unrecognized stock-based compensation costs to be recognized over future periods	58		$ 66
Unrecognized stock-based compensation costs to be recognized in future periods for awards that vest over requisite service period	$ 58
Weighted average period over which unrecognized stock-based compensation costs are expected to be recognized, for awards that vest over requisite service period or upon change in control	1 year 9 months 18 days
Income tax benefit recognized in the consolidated statements of operations for share-based compensation arrangements	$ 2	$ 9
Shares
Outstanding at the beginning of the period (in shares)	1,332,632
Granted (in shares)	76,559
Outstanding at the end of the period (in shares)	1,409,191		1,332,632
Exercisable at the end of the period (in shares)	1,277,737
Vested or expected to vest at the end of the period (in shares)	1,409,191
Weighted-Average Exercise Price (actual per share price)
Outstanding at the beginning of the period (in dollars per share)	$ 2.25
Granted (in dollars per share)	1.00
Outstanding at the end of the period (in dollars per share)	2.18		$ 2.25
Exercisable at the end of the period (in dollars per share)	2.25
Vested or expected to vest at the end of the period (in dollars per share)	$ 2.18
Weighted-Average Remaining Contractual Term
Weighted-Average Remaining Contractual Term	8 years 3 months 18 days		8 years 6 months
Granted	8 years 3 months 18 days
Exercisable at the end of the period	8 years 2 months 12 days
Vested or expected to vest at the end of the period	8 years 3 months 18 days
Stock options
Stock based compensation
Granted (in shares)	76,559
Granted (in dollars per share)	$ 1.00
Shares
Granted (in shares)	76,559
Weighted-Average Exercise Price (actual per share price)
Granted (in dollars per share)	$ 1.00

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Business Segments (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($) segment	Mar. 31, 2017 USD ($)	Dec. 31, 2017 USD ($)
Business segment
Number of operating segments | segment	2
Total Assets	$ 204,016	$ 366,701	$ 212,406
Goodwill		113,256
Other Intangible Assets	802	1,288	$ 924
Total Revenues	$ 87,651	$ 85,352
Total Revenues, % of Revenue	100.00%	100.00%
Provision for loan losses	$ 22,635	$ 19,540
Provision for Loan Losses, % of Revenue	25.80%	22.90%
Other Operating Expenses	$ 37,831	$ 39,216
Other Operating Expenses, % of Revenue	43.20%	45.90%
Operating Gross Profit	$ 27,185	$ 26,596
Operating Gross Profit, % of Revenue	31.00%	31.20%
Interest Expense, net	$ 12,178	$ 11,371
Interest Expense, net, % of Revenue	13.90%	13.30%
Depreciation and Amortization	$ 1,093	$ 1,309
Depreciation and Amortization, % of Revenue	1.30%	1.50%
Lease termination		$ 1,762
Lease termination Expenses, % of Revenue		2.10%
Other Corporate Expenses	$ 17,602	$ 20,186
Other corporate Expenses, % of Revenue	20.10%	23.70%
Loss from continuing operations, before tax	$ (3,688)	$ (8,032)
Income from Continuing Operations, before tax	(4.20%)	(9.40%)
Unallocated (Income) Expenses
Business segment
Other Corporate Expenses	$ 17,602	$ 20,186
Loss from continuing operations, before tax	(17,602)	(20,186)
Retail Financial Services
Business segment
Total Assets	166,505	309,595
Goodwill		113,256
Other Intangible Assets	336	488
Total Revenues	$ 72,797	$ 68,691
Total Revenues, % of Revenue	100.00%	100.00%
Provision for loan losses	$ 15,620	$ 12,058
Provision for Loan Losses, % of Revenue	21.40%	17.60%
Other Operating Expenses	$ 36,291	$ 38,207
Other Operating Expenses, % of Revenue	49.90%	55.60%
Operating Gross Profit	$ 20,886	$ 18,426
Operating Gross Profit, % of Revenue	28.70%	26.80%
Interest Expense, net	$ 9,479	$ 7,366
Interest Expense, net, % of Revenue	13.00%	10.70%
Depreciation and Amortization	$ 1,000	$ 1,129
Depreciation and Amortization, % of Revenue	1.40%	1.60%
Loss from continuing operations, before tax	$ 10,407	$ 9,931
Income from Continuing Operations, before tax	14.30%	14.50%
Internet Financial Services
Business segment
Total Assets	$ 37,511	$ 57,106
Other Intangible Assets	466	800
Total Revenues	$ 14,854	$ 16,661
Total Revenues, % of Revenue	100.00%	100.00%
Provision for loan losses	$ 7,015	$ 7,482
Provision for Loan Losses, % of Revenue	47.20%	44.90%
Other Operating Expenses	$ 1,540	$ 1,009
Other Operating Expenses, % of Revenue	10.40%	6.10%
Operating Gross Profit	$ 6,299	$ 8,170
Operating Gross Profit, % of Revenue	42.40%	49.00%
Interest Expense, net	$ 2,699	$ 4,005
Interest Expense, net, % of Revenue	18.20%	24.00%
Depreciation and Amortization	$ 93	$ 180
Depreciation and Amortization, % of Revenue	0.60%	1.10%
Lease termination		$ 1,762
Lease termination Expenses, % of Revenue		10.60%
Loss from continuing operations, before tax	$ 3,507	$ 2,223
Income from Continuing Operations, before tax	23.60%	13.30%

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Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Income Taxes
Liability recorded for unrecognized tax benefits	$ 0	$ 0
Gross deferred tax assets	72,877	71,896
Valuation allowance	72,877	$ 71,896
Credits or net operating losses	$ 0

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Transactions with Variable Interest Entities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Variable Interest Entities
Accrual for third-party losses	$ 3,768	$ 4,818
Insight Holdings
Variable Interest Entities
Outstanding amount of active third party consumer loans	29,575	36,967
Accrual for third-party losses	3,768	4,818
Short-term consumer loans | Insight Holdings
Variable Interest Entities
Outstanding amount of active third party consumer loans	28,646	35,801
Medium-term consumer loans | Insight Holdings
Variable Interest Entities
Outstanding amount of active third party consumer loans	$ 929	$ 1,166

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Supplemental Guarantor Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($)
CCFI
Supplemental guarantor information
Independent assets	$ 0
Independent operations	0
Guarantor Subsidiaries | Financial guarantee | 2019 and 2020 Notes
Supplemental guarantor information
Total net worth requirements	4,610
Guarantor Subsidiaries | Financial guarantee | Minimum | 2019 and 2020 Notes
Supplemental guarantor information
Net worth required to be maintained	10
Guarantor Subsidiaries | Financial guarantee | Maximum | 2019 and 2020 Notes
Supplemental guarantor information
Net worth required to be maintained	$ 2,000

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information (Details)	Mar. 31, 2018
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information
Ownership interest (as a percent)	100.00%

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Current Assets
Cash and cash equivalents	$ 85,274	$ 66,627	$ 121,784	$ 106,333
Restricted cash	4,420	4,585	3,515	$ 3,015
Finance receivables, net	68,286	89,707
Card related pre-funding and receivables	841	1,062
Other current assets	13,522	15,271
Total current assets	172,343	177,252
Noncurrent Assets
Finance receivables, net	3,626	4,632
Property, leasehold improvements and equipment, net	24,816	26,848
Goodwill			113,256
Other intangible assets	802	924	1,288
Security deposits	2,429	2,750
Total assets	204,016	212,406	$ 366,701
Current Liabilities
Accounts payable and accrued liabilities	31,803	39,566
Money orders payable	8,024	7,169
Accrued interest	11,942	5,145
Current portion of capital lease obligation	160	371
Current portion of subsidiary note payable	120	118
Deferred revenue	2,535	2,535
Total current liabilities	54,584	54,904
Noncurrent Liabilities
Lease termination payable	569	818
Lines of credit	42,799	45,129
Subsidiary note payable	59,600	61,077
Senior secured notes	248,425	248,126
Deferred Revenue	6,887	7,520
Total liabilities	412,864	417,574
Stockholders' Equity (Deficit)
Total stockholders' deficit	(208,848)	(205,168)
Total liabilities and stockholders' equity	204,016	212,406
Eliminations
Current Assets
Other current assets	(18,294)	(42,284)
Total current assets	(18,294)	(42,284)
Noncurrent Assets
Investment in Subsidiaries	(365,365)	(360,599)
Total assets	(383,659)	(402,883)
Current Liabilities
Accounts payable and accrued liabilities	(8,209)	(32,494)
Accrued interest	(4,232)	(3,937)
CCFI funding notes	(5,853)	(5,853)
Total current liabilities	(18,294)	(42,284)
Noncurrent Liabilities
Total liabilities	(18,294)	(42,284)
Stockholders' Equity (Deficit)
Total stockholders' deficit	(365,365)	(360,599)
Total liabilities and stockholders' equity	(383,659)	(402,883)
Community Choice Financial | Reportable legal entities
Noncurrent Assets
Investment in Subsidiaries	365,365	360,599
Total assets	365,365	360,599
Current Liabilities
Accrued interest	11,937	5,140
Total current liabilities	11,937	5,140
Noncurrent Liabilities
Lines of credit	42,799	45,129
Senior secured notes	248,425	248,126
Total liabilities	303,161	298,395
Stockholders' Equity (Deficit)
Total stockholders' deficit	62,204	62,204
Total liabilities and stockholders' equity	365,365	360,599
Guarantor Subsidiaries | Reportable legal entities
Current Assets
Cash and cash equivalents	63,751	57,526
Restricted cash	4,420	4,585
Finance receivables, net	20,859	47,221
Card related pre-funding and receivables	841	1,062
Other current assets	22,161	39,604
Total current assets	112,032	149,998
Noncurrent Assets
Finance receivables, net	3,626	4,632
Property, leasehold improvements and equipment, net	24,816	26,848
Other intangible assets	802	924
Security deposits	2,429	2,750
Total assets	143,705	185,152
Current Liabilities
Accounts payable and accrued liabilities	25,761	57,696
Money orders payable	8,024	7,169
Accrued interest	5	5
Current portion of capital lease obligation	160	371
Current portion of subsidiary note payable	120	118
Deferred revenue	2,535	2,535
Total current liabilities	36,605	67,894
Noncurrent Liabilities
Lease termination payable	569	818
Subsidiary note payable	1,791	1,821
Deferred Revenue	6,887	7,520
Total liabilities	45,852	78,053
Stockholders' Equity (Deficit)
Total stockholders' deficit	97,853	107,099
Total liabilities and stockholders' equity	143,705	185,152
Non-Guarantor Subsidiaries | Reportable legal entities
Current Assets
Cash and cash equivalents	21,523	9,101
Finance receivables, net	47,427	42,486
Other current assets	9,655	17,951
Total current assets	78,605	69,538
Noncurrent Assets
Total assets	78,605	69,538
Current Liabilities
Accounts payable and accrued liabilities	14,251	14,364
Accrued interest	4,232	3,937
CCFI funding notes	5,853	5,853
Total current liabilities	24,336	24,154
Noncurrent Liabilities
Subsidiary note payable	57,809	59,256
Total liabilities	82,145	83,410
Stockholders' Equity (Deficit)
Total stockholders' deficit	(3,540)	(13,872)
Total liabilities and stockholders' equity	$ 78,605	$ 69,538

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Consolidated Statements of Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenues:
Total Revenues	$ 87,651	$ 85,352
Corporate and other expenses:
Salaries	17,132	17,273
Provision for loan losses	22,635	19,540
Occupancy	6,343	6,629
Advertising and marketing	1,011	814
Lease termination costs	97	47
Depreciation and amortization	2,223	2,538
Other	11,025	11,915
Total operating expenses	60,466	58,756
Operating gross profit	27,185	26,596
Corporate expenses	17,602	20,186
Lease Termination		1,762
Depreciation and amortization	1,093	1,309
Interest expense, net	12,178	11,371
Total corporate and other expenses	30,873	34,628
Loss from continuing operations, before tax	(3,688)	(8,032)
Provision for income taxes		333
Net loss	(3,688)	(8,365)
Eliminations
Revenues:
Dividend		(3,000)
Total Revenues	(295)	(3,295)
Corporate and other expenses:
Operating gross profit	(295)	(3,295)
Interest expense, net	(295)	(295)
Total corporate and other expenses	(295)	(295)
Loss from continuing operations, before tax		(3,000)
Provision for income taxes		125
Net loss		(3,125)
Community Choice Financial | Reportable legal entities
Corporate and other expenses:
Interest expense, net	9,367	9,023
Interest expense allocation	(9,367)	(9,023)
Guarantor Subsidiaries | Reportable legal entities
Revenues:
Dividend		3,000
Total Revenues	59,584	79,377
Corporate and other expenses:
Salaries	17,132	17,273
Provision for loan losses	9,205	16,458
Occupancy	6,343	6,629
Advertising and marketing	1,011	814
Lease termination costs	97	47
Depreciation and amortization	2,223	2,538
Other	11,025	11,914
Total operating expenses	47,036	55,673
Operating gross profit	12,548	23,704
Corporate expenses	17,490	20,095
Intercompany management fee	(1,385)	(427)
Lease Termination		1,762
Depreciation and amortization	1,093	1,309
Interest expense, net	124	195
Interest expense allocation	9,367	9,023
Total corporate and other expenses	26,689	31,957
Loss from continuing operations, before tax	(14,141)	(8,253)
Provision for income taxes		342
Net loss	(14,141)	(8,595)
Non-Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	28,362	9,270
Corporate and other expenses:
Provision for loan losses	13,430	3,082
Other		1
Total operating expenses	13,430	3,083
Operating gross profit	14,932	6,187
Corporate expenses	112	91
Intercompany management fee	1,385	427
Interest expense, net	2,982	2,448
Total corporate and other expenses	4,479	2,966
Loss from continuing operations, before tax	10,453	3,221
Provision for income taxes		(134)
Net loss	10,453	3,355
Finance receivable fees
Revenues:
Total Revenues	50,932	49,051
Finance receivable fees | Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	22,863	39,830
Finance receivable fees | Non-Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	28,069	9,221
Credit service fees
Revenues:
Total Revenues	19,196	18,139
Credit service fees | Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	19,196	18,139
Check cashing fees
Revenues:
Total Revenues	11,692	12,126
Check cashing fees | Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	11,692	12,126
Card fees
Revenues:
Total Revenues	1,948	2,007
Card fees | Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	1,948	2,007
Other
Revenues:
Total Revenues	3,883	4,029
Other | Eliminations
Revenues:
Total Revenues	(295)	(295)
Other | Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	3,885	4,275
Other | Non-Guarantor Subsidiaries | Reportable legal entities
Revenues:
Total Revenues	$ 293	$ 49

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Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Condensed Consolidating Statement of Cash Flows
Net cash provided by operating activities	$ 24,589	$ 22,200
Cash flows from investing activities
Net receivables repaid (originated)	(208)	(2,721)
Purchase of leasehold improvements and equipment	(1,274)	(1,001)
Net cash used in investing activities	(1,482)	(3,722)
Cash flows from financing activities
Payments on subsidiary note	(30)	(29)
Payments on capital lease obligations, net	(211)	(248)
Payments on capital lease obligations, net		(2,250)
Debt issuance costs	(4,384)
Net cash used in financing activities	(4,625)	(2,527)
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	18,482	15,951
Cash and cash equivalents and restricted cash:
Beginning	71,212	109,348
Ending	89,694	125,299
Nonoperating Income (Expense)	(30,873)	(34,628)
Eliminations
Cash and cash equivalents and restricted cash:
Nonoperating Income (Expense)	295	295
Community Choice Financial | Reportable legal entities
Condensed Consolidating Statement of Cash Flows
Net cash provided by operating activities	2,762
Cash flows from financing activities
Debt issuance costs	(2,762)
Net cash used in financing activities	(2,762)
Guarantor Subsidiaries | Reportable legal entities
Condensed Consolidating Statement of Cash Flows
Net cash provided by operating activities	(10,588)	16,121
Cash flows from investing activities
Net receivables repaid (originated)	18,163	(5,830)
Purchase of leasehold improvements and equipment	(1,274)	(1,001)
Net cash used in investing activities	16,889	(6,831)
Cash flows from financing activities
Payments on subsidiary note	(30)	(29)
Payments on capital lease obligations, net	(211)	(248)
Payments on capital lease obligations, net		(2,250)
Net cash used in financing activities	(241)	(2,527)
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	6,060	6,763
Cash and cash equivalents and restricted cash:
Beginning	62,111	74,792
Ending	68,171	81,555
Nonoperating Income (Expense)	(26,689)	(31,957)
Non-Guarantor Subsidiaries | Reportable legal entities
Condensed Consolidating Statement of Cash Flows
Net cash provided by operating activities	32,415	6,079
Cash flows from investing activities
Net receivables repaid (originated)	(18,371)	3,109
Net cash used in investing activities	(18,371)	3,109
Cash flows from financing activities
Debt issuance costs	(1,622)
Net cash used in financing activities	(1,622)
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	12,422	9,188
Cash and cash equivalents and restricted cash:
Beginning	9,101	34,556
Ending	21,523	43,744
Nonoperating Income (Expense)	$ (4,479)	$ (2,966)