The net assets of our technology segment, which consisted of NTS, are represented as held-for-sale as of December 31, 2024 as a result of our entry into the NTS Sale Agreement and our divestiture of NTS on January 2, 2025 (consistent with our commitments to the Federal Reserve). Refer to “NOTE 1—DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION” - Sale of NTS.

The following tables present the assets classified as held for sale and the liabilities directly associated with assets classified as held for sale as of December 31, 2024:


ASSETS			LIABILITIES
Held for Sale			Directly Associated with Assets Held for Sale
Cash and due from banks	$	325	Lease liabilities	$	685
Goodwill	11,800		Deferred tax liabilities, net	2,975
Intangibles	3,030		Accounts payable, accrued expenses and other liabilities	2,564
Right of use assets	619
Other assets	6,150
Valuation allowance1	(616)
	$	21,308		$	6,224

1 The associated expense is included in Other general and administrative costs in the consolidated statements of operations for the year ended December 31, 2024.

The goodwill in the technology segment was generated from acquisitions by the legal entities within that segment prior to the consolidation of the those entities into NewtekOne following the 2023 Acquisition.

The intangible asset for customer lists within the technology segment existed prior to the consolidation of the technology segment into NewtekOne following the Acquisition.


	As of December 31, 2024
	Gross carrying Amount		Accumulated Amortization		Net Carrying amount
Technology Customer Lists	$	6,525	$	(3,495)	$	3,030

Under ASC 842, operating lease expense is generally recognized on a straight-line basis over the term of the lease. The Company has entered into operating lease agreements for office space with remaining contractual terms up to 0.7 year, some of which include renewal options. These renewal options are not considered in the remaining lease term unless it is reasonably certain the Company will exercise such options. The operating lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As the rate implicit in the leases generally is not readily determinable for our operating leases, the discount rates used to determine the present value of our lease liability are based on our incremental borrowing rate at the lease commencement date and commensurate with the remaining lease term. Our incremental borrowing rate for a lease is the rate of interest we would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are excluded from our weighted-average remaining lease term.