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Note 15 - Notes Receivable

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

Note 15 - Notes Receivable

Several franchisees borrowed funds from us primarily to finance the initial purchase price of office assets, including intangible assets.

Notes outstanding, net of allowance for losses, were approximately $6.9 million and $7.8 million as of September 30, 2025 and December 31, 2024, respectively. Notes receivable generally bear interest at a fixed rate between 6.0% and 10.0%. Notes receivable are generally secured by the assets of each office and the ownership interests in the franchise. We report interest income on notes receivable as "Interest income" in our Consolidated Statements of Operations. Interest income was approximately $131 thousand and $138 thousand during the three months ended September 30, 2025 and September 30, 2024, respectively, and approximately $393 thousand and $424 thousand during the nine months ended September 30, 2025 and September 30, 2024, respectively.

We estimate the allowance for credit losses for franchisees separately from the allowance for credit losses from non-franchisees because of the level of detailed sales information available to us with respect to our franchisees. Based on our review of available collateral historical information, current conditions, and reasonable and supportable forecasts, we have established an allowance of approximately $1.1 million and $773 thousand as of September 30, 2025 and December 31, 2024, respectively, for credit losses.

The following table summarizes our notes receivable balance to franchisees:

(in thousands)			*September 30, 2025*				*December 31, 2024*
Notes receivable		$	7,928			$	8,603
Allowance for losses			(1,076	)			(773	)
Notes receivable, net		$	6,852			$	7,830