Company: CPSS
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001683168-25-001548
Chunk: 33

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 1
Chunk 33
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 our existing debt or to obtain additional financing would have a material adverse
effect on our financial position, liquidity and results of operations.

The degree to which we are leveraged creates risks,
including:

·we may be unable to satisfy our obligations under our outstanding indebtedness;

·we may find it more difficult to fund future credit enhancement requirements, operating costs, tax payments, capital expenditures
or general corporate expenditures;

·we may have to dedicate a substantial portion of our cash resources to payments on our outstanding indebtedness, thereby reducing
the funds available for operations and future business opportunities; and

·increasing our vulnerability to adverse general economic, industry and capital markets conditions.

·limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

·placing us at a competitive disadvantage compared to our competitors that have less debt; and

·limiting our ability to borrow additional funds.

Although we believe we are
able to service and repay such debt, there is no assurance that we will be able to do so. If we do not generate sufficient operating profits,
our ability to make required payments on our debt would be impaired. Failure to pay our indebtedness when due would give rise to various
remedies in favor of any unpaid creditors, and creditors’ exercise of such remedies could have a material adverse effect on our
earnings.

Our Results of Operations Will Depend on Our Ability to Securitize
Our Portfolio of Automobile Contracts.

We depend upon our ability
to obtain permanent financing for pools of automobile contracts by conducting term securitization transactions. By "permanent financing"
we mean financing that extends to cover the full term during which the underlying automobile contracts are outstanding and requires repayment
as the underlying automobile contracts are repaid or charged off. By contrast, our warehouse credit facilities permit us to borrow against
the value of such receivables only for limited periods of time. Our past practice and future plan has been and is to repay loans made
to us under our warehouse credit facilities with the proceeds of securitizations. There can be no assurance that any securitization transaction
will be available on terms acceptable to us, or at all. The timing of any securitization transaction is affected by a number of factors
beyond our control, any of which could cause substantial delays, including, without limitation:

·market conditions;

·the approval by all parties of the terms of the securitization;

·our ability to acquire a sufficient number of automobile contracts