Company: ATLCL
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001437749-25-033947
Chunk: 157

Company: Atlanticus Holdings Corp
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 157
---
 of a derivative instrument under Accounting Standards Codification ("ASC") 815, "Derivatives and Hedging". We have recorded the derivative at fair value within Accounts payable and accrued expenses on the accompanying condensed consolidated balance sheets, calculated using internally-developed estimates. These estimates on performance of the acquired portfolio include expected credit losses, payment rates, servicing costs, discount rates and yields earned on our general purpose credit card receivables. See Note 7, "Fair Values of Assets and Liabilities" for more information. 
    
   As a result of the acquisition, the Company added approximately 1.3 million credit card serviced accounts, $3.2 billion in credit card receivables and assumed $2.8 billion in collateralized debt. Additionally, the Company acquired certain identifiable finite-lived intangible assets primarily associated with internally developed software. The Company expensed approximately $2.5 million of acquisition costs and approximately $4.3 million of severance costs within Other expense and Salaries and benefits, respectively, during the three and nine months ended  September 30, 2025. The condensed consolidated statement of operations includes, for the three and nine months ended  September 30, 2025, Mercury’s operating results from  September 11, 2025 through  September 30, 2025. For that period, Mercury contributed approximately $49.9 million of revenue and $(7.0) million of net loss. See Note 7 "Fair Values of Assets and Liabilities" and Note 10 "Notes Payable" for more information on the acquired credit card receivables and assumed debt obligations and see Note 3 "Significant Accounting Policies and Condensed Consolidated Financial Statement Components" for more information on our finite-lived intangible assets.
    
   The acquisition was accounted for as an asset acquisition under ASC 805, "Business Combinations". Fair values of assets acquired and liabilities assumed were determined using management estimates and third-party valuations (e.g., replacement cost method). 

    3.  Significant Accounting Policies and Condensed Consolidated Financial Statement Components 

   The following is a summary of significant accounting policies we follow in preparing our condensed consolidated financial statements, as well as a description of significant components of our condensed consolidated financial statements. The condensed consolidated financial statements furnished have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and reflect all normal and recurring adjustments that