The terms “CURO" and the “Company” refer to CURO Group Holdings Corp. and its directly and indirectly owned subsidiaries as a combined entity, except where otherwise stated. The term "CFTC" refers to CURO Financial Technologies Corp., a wholly-owned subsidiary, and its directly and indirectly owned subsidiaries as a consolidated entity, except where otherwise stated.

The Company has prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States of America (“US GAAP”),GAAP, and with the accounting policies described in its Annual Report2019 Form 10-K filed with the SEC on Form 10-KMarch 9, 2020. Interim results of operations are not necessarily indicative of the results that might be expected for future interim periods or for the year endedending December 31, 2018 ("2018 Form 10-K"). 2020.

Certain information and note disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted, although the Company believes that the disclosures are adequate to enable a reasonable understanding of the information presented. Additionally, the Company qualifies as an SRC as defined by the SEC, which allows registrants to report information under scaled disclosure requirements. SRC status is determined on an annual basis as of the last business day of the most recently completed second fiscal quarter. Under these rules, the Company met the definition of an SRC as of June 30, 2019, and it will reevaluate as of June 30, 2020.

The unaudited Condensed Consolidated Financial Statements and the accompanying notes reflect all adjustments (consisting only of adjustments of a normal and recurring nature) which are, in the opinion of management, necessary to present fairly the Company's results of operations, financial position and cash flows for the periods presented.

A novel strain of coronavirus, COVID-19, surfaced in late 2019 and has subsequently spread worldwide, including to the U.S. and Canada. On February 25, 2019,March 11, 2020, the World Health Organization categorized COVID-19 as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. Macroeconomic conditions, in general, and the Company's U.K. segment was placed into administration,operations have been significantly affected by the COVID-19 pandemic and there are no reliable estimates of how long the pandemic will last or the scope or magnitude of its near-term or long-term impact. In response, various governmental bodies have issued decrees prohibiting certain businesses from continuing to operate and certain classes of workers from reporting to work. However, CURO's operations have been designated as essential financial services by federal guidelines and local regulations. As a provider of an essential service, the Company remains focused on protecting the health and wellbeing of its employees, customers and the communities in which resultedit operates while assuring the continuity of its business operations. While CURO continues serving its customers through both store and online channels, store hours are reduced, enhanced cleaning protocols for all facilities are in treatmentplace, and social distancing guidelines are in effect to aid in combating the spread of the segment as discontinued operationspandemic.

The Condensed Consolidated Financial Statements shouldeffect of the COVID-19 pandemic will not be read in conjunction with the Consolidated Financial Statements and related Notes includedfully reflected in the 2018 Form 10-K. InterimCompany's results of operations are not necessarily indicativeand overall financial performance until future periods. The extent of results that may be expected for future interim periods or for the year ending December 31, 2019.impact of COVID-19 on the Company's business is highly uncertain and difficult to predict, as information is rapidly evolving with respect to the duration and severity of the pandemic.

The Condensed Consolidated Financial Statements include the accounts of CURO and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation.

The preparation of Condensed Consolidated Financial Statements in conformity with US GAAP requires management to make estimates and assumptions, such as those posed by COVID-19, that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the periods reported.presented. Some of the significant estimates that the Company made in the accompanying Condensed Consolidated Financial Statements include allowances for loan losses, certain assumptions related to equity investments, goodwill and intangibles, accruals related to self-insurance, credit services organization ("CSO")CSO liability for losses and estimated tax liabilities. Actual results may differ from those estimates.

The annual impairment review for goodwill, done on October 1, consists of Operationsperforming a qualitative assessment to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount as a basis for determining whether or not further testing is required. The Company may elect to bypass the qualitative assessment and proceed directly to the two-step process, for any reporting unit, in any period. The Company can resume the qualitative assessment for any reporting unit in any subsequent period. If the Company determines, on the basis of qualitative factors, that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, the Company will then apply a two-step process of (i) determining the fair value of the reporting unit and (ii) comparing it to the carrying value of the net assets allocated to the reporting unit. When performing the two-step process, if the fair value of the reporting unit exceeds its carrying value, no further analysis or write-down of goodwill is required. In the event the estimated fair value of a reporting unit is less than the carrying value, the Company would recognize an impairment loss equal to such excess, which could significantly and adversely impact reported results of operations and stockholders’ equity.

NOTE 2 - VARIABLE INTEREST ENTITIES

As theThe Company has determined that it is the primary beneficiary of the VIEs,VIE and is required to consolidate the entity. The Company includes the assets and liabilities related to the VIEsVIE in itsthe unaudited Condensed Consolidated Financial Statements.Balance Sheets. As required, the CompanyCURO parenthetically discloses on the unaudited Condensed Consolidated Balance Sheets the VIEs’VIE's assets that can only be used to settle the VIEs'VIE's obligations and liabilities if the VIEs’VIE's creditors have no recourse against the Company's general credit.

The carrying amounts of consolidated VIEs'VIE's assets and liabilities associated with the VIE subsidiariessubsidiary were as follows:follows (in thousands):

The following table summarizes revenue by product for the periods indicated:

The following tables summarize loans guaranteed by the Company under CSO programs and the related delinquent receivables at March 31, 2019:(in thousands):

The following table summarizes activity in the liability for losses on CSO lender-owned consumer loans during the three months ended March 31, 2019:(in thousands):

The following table summarizes activity in the allowance for loan losses and the liability for losses on CSO lender-owned consumer loans in total during the three months ended March 31, 2019:(in thousands):

The following table summarizes activity in the allowance for loan losses during the three months ended March 31, 2018:(in thousands):

The following table summarizes activity in the liability for losses on CSO lender-owned consumer loans during the three months ended March 31, 2018:(in thousands):

The following table summarizes activity in the allowance for loan losses and the liability for losses on CSO lender-owned consumer loans, a non-GAAP metric, in total during the three months ended March 31, 2018:(in thousands):

The CSO fee receivable amountsreceivables under CSO programs were $11.0$6.8 million and $14.3$14.7 million at March 31, 20192020 and December 31, 2018, respectively.2019, respectively, and are reflected in "Prepaid expenses and other" in the unaudited Condensed Consolidated Balance Sheets. The Company bears the risk of loss through its guarantee to purchase specific customer loans that are in default fromwith the lenders. The terms of these loans range fromup to six to 18 months. See the 20182019 Form 10-K for further details of the Company's accounting policy.

As of March 31, 20192020 and December 31, 2018,2019, the incremental maximum amount payable under all such guarantees was $51.6$45.7 million and $66.9$62.7 million, respectively. If the Company is required to pay any portion of the total amount of the loans it has guaranteed, it will attempt to recover some or the entire amount from the applicable customers. The Company holds no collateral in respect of the guarantees. The Company estimates a liability for losses associated with the guaranty provided

The Company placed $13.5$5.7 million and $17.2$6.2 million in collateral accounts for the benefit of lenders at March 31, 20192020 and December 31, 2018,2019, respectively, which is reflected in "Prepaid expenses and other" in the unaudited Condensed Consolidated Balance Sheets. The balances required to be maintained in these collateral accounts vary by lender, typically based on a percentage of the outstanding loan balances held by the lender. The percentage of outstanding loan balances required for collateral is negotiated between the Company and each such lender.

In August 2018, the Company issued $690.0 million of 8.25% Senior Secured Notes which mature on September 1, 2025 ("8.25% Senior Secured Notes").2025. Interest on the notes is payable semiannually, in arrears, on March 1 and September 1. In connection with the 8.25% Senior Secured Notes, the balance of capitalized financing costs of approximately $12.8$11.3 million, net of amortization, is included in the unaudited Condensed Consolidated Balance Sheets as a component of "Long-term debt."Debt." These costs are amortized over the term of the 8.25% Senior Secured Notes as a component of interest expense.

The Company used the proceeds of this issuance were used (i) to redeem the outstanding 12.00% Senior Secured Notes of CFTC, (ii) to repay a portion of the outstanding indebtedness under the five-year revolving credit facility of CURO Receivables Finance I, LLC, a wholly-owned subsidiary, ("CURO Receivables"), which consisted of a term loan and revolving borrowing capacity, (iii) for general corporate purposes and (iv) to pay fees, expenses, premiums and accrued interest in connection therewith.

On August 2, 2018, CURO Canada Receivables Limited Partnership, a newly created, bankruptcy-remote special purpose vehicle (the "Canada SPV Borrower") and a wholly-owned subsidiary, entered into a four-year revolving credit facility with Waterfall Asset Management, LLC that providesprovided for C$175.0 million of initial borrowing capacity and the ability to expand such capacity up to C$250.0 million ("Non-Recourse Canada SPV Facility"). The loans bear interest at an annual rate of 6.75% plus the three-month CDOR. The Canada SPV Borrower also pays a 0.50% per annum commitment fee on the unused portion of the commitments. In April 2019, the facility's maturity date was extended one year, and now matures into September 2, 2023.

On September 1, 2017, the Company entered into a $25.0 million Senior Secured Revolving Loan Facility (the “Senior Revolver”). The terms of the Senior Revolver generally conform to the related provisions in the Indenture dated February 15, 2017 for the 12.00% Senior Secured Notes and complements the Company's other financing sources, while providing seasonal short-term liquidity.with $25.0 million of capacity. In February 2018, the Senior Revolver capacity was increased to $29.0 million as permitted by the Indenture to the 12.00% Senior Secured Notes based upon consolidated tangible assets. Additionally, in November 2018, the Senior Revolver capacity was increased to $50.0 million as permitted by the Indenture to the 8.25% Senior Secured Notes. The Senior Revolver is now syndicated with participation by four banks.

Under the Senior Revolver, there is $50.0 million maximum availability, including up to $5.0 million of standby letters of credit, for a one-year term, renewable for successive terms following annual review. The current term has been extended to June 30, 2021. The Senior Revolver accrues interest at the one-month LIBOR plus 5.00% (subject to a 5% overall rate minimum) and is repayable on demand..

The terms of the Senior Revolver also require that its outstanding balance be zero for at least 30 consecutive days in each calendar year. The Senior Revolver is guaranteed by all subsidiaries that guarantee the 8.25% Senior Secured Notes and is secured by a lien on substantially all assets of CURO and the guarantor subsidiaries that is senior to the lien securing the 8.25% Senior Secured Notes. Additionally, the negative covenants of the Senior Revolver generally conform to the related provisions in the Indenture for the 8.25% Senior Secured Notes. The revolver was undrawnhad an outstanding balance of $25.0 million at March 31, 2019.2020.

The Senior Revolver contains various conditions to borrowing and affirmative, negative and financial maintenance covenants. Certain of the more significant covenants are (i) minimum eligible collateral value, (ii) consolidated interest coverage ratio and (iii) consolidated leverage ratio. The Senior Revolver also contains various events of default, the occurrence of which could result in termination of the lenders’ commitments to lend and the acceleration of all obligations under the Senior Revolver. As of March 31, 2019, the Company was in full compliance with the covenants and other provisions of the Senior Revolver.

Cash Money Cheque Cashing, Inc., a Canadian subsidiary ("Cash Money"), maintains a C$10.0 million revolving credit facility with Royal Bank of Canada (the "Cash Money Revolving Credit Facility"), which provides short-term liquidity required to meet the working capital needs of the Company's Canadian operations. Aggregate draws under the revolving credit facility are limited to the lesser of: (i) the borrowing base, which is defined as a percentage of cash, deposits in transit and accounts receivable, and

The Cash Money Revolving Credit Facility is collateralized by substantially all of Cash Money’s assets and contains various covenants that include,require, among other things, that the aggregate borrowings outstanding under the facility not exceed the borrowing base, as well as restrictions on the encumbrance of assets and the creation of indebtedness. Borrowings under the Cash Money Revolving Credit Facility bear interest (per annum)per annum at the prime rate of a Canadian chartered bank plus 1.95%.

The Cash Money Revolving Credit Facility was undrawn at March 31, 20192020 and December 31, 2018.2019.

The Company's stockholder-approved 2017 Incentive Plan provides for the issuance of up to 5.0 million shares, subject to certain adjustment provisions, which may be issued in the form of stock options, restricted stock awards, restricted stock units (“RSUs”),RSUs, stock appreciation rights, performance awards and other awards that may be settled in or based uponon common stock. Awards may be granted to officers, employees, consultants and directors. The 2017 Incentive Plan provides that shares of common stock subject to awards granted become available for re-issuance if such awards expire, terminate, are canceled for any reason or are forfeited by the recipient.

Grants of time-based RSUs that will vest if certain performance conditions are met by the Company. These RSUs were designed to drive the performance of the management team toward achievement of key corporate objectives and will only vest if the performance targets are met by March 14, 2022. Expense recognition for the performance awards, which was immaterial to the first quarter of 2019, commences if and when it is determined that attainment of the performance goal is probable.

Grants of a performance condition to vestmarket-based RSUs are typically valued using the Monte Carlo simulation pricing model. Grants ofThe market-based RSUs do not confer fullvest after three years if the Company's total stockholder rights such as voting rights and cash dividends, but providereturn over the three-year performance period meets a specified target relative to other companies in its selected peer group. Expense recognition for additional dividend equivalent RSUthe market-based awards in lieu of cash dividends. occurs over the service period using the straight-line method.

Unvested shares of RSUs may be forfeited upon termination of employment depending on the circumstances of the termination, or failure to achieve the required performance condition, if applicable.

A summary of the statusactivity of time-based and performance-basedmarket-based unvested RSUs as of March 31, 20192020 and changes during the three months ended March 31, 20192020 are presented in the following table: