Company: CPSS
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001683168-25-005901
Chunk: 60

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-08-11
Form: 10-Q
Item: Part I, Item 8
Chunk 60
---

collections from the related trusts will continue to generate sufficient cash.

Our warehouse credit facilities
contain various financial covenants requiring certain minimum financial ratios and results. Such covenants include maintaining minimum
levels of liquidity and net worth and not exceeding maximum leverage levels. In addition, certain of our debt agreements other than our
term securitizations contain cross-default provisions. Such cross-default provisions would allow the respective creditors to declare
a default if an event of default occurred with respect to other indebtedness of ours, but only if such other event of default were to
be accompanied by acceleration of such other indebtedness. As of June 30, 2025, we were in compliance with all such financial covenants.

 48 

We have and will continue to
have a substantial amount of indebtedness. At June 30, 2025, we had approximately $3,392.8 million of debt outstanding. Such debt consisted
primarily of $2,813.2 million of securitization trust debt and $395.6 million of debt from warehouse lines of credit. Our securitization
trust debt has increased by $218.9 million while our warehouse lines of credit debt has decreased by $15.3 million since December 31,
2024 (each net of deferred financing costs). Since 2005, we have offered renewable subordinated notes to the public on a continuous basis,
and such notes have maturities that range from six months to 10 years. We had $28.8 million and $26.5 million in subordinated renewable
notes outstanding at June 30, 2025, and December 31, 2024, respectively. In June 2021, March 2024, and again on March 20, 2025, we completed
a securitization of residual interests from other previously issued securitizations in the amount of $50 million, $50 million, and $65
million, respectively. As of June 30, 2025, all $155.1 million of the residual interest debt remains outstanding.

Although we believe we are
able to service and repay our debt, there is no assurance that we will be able to do so. If our plans for future operations do not generate
sufficient cash flows and earnings, our ability to make required payments on our debt would be impaired. If we fail to pay our indebtedness
when due, it could have a material adverse effect on us and may