2026 2nd Quarter Report

Second Quarter Report | 2026

Flexible Financing Solutions from Accord

Asset-based Lending

Accordlasset-basedlending serves companies of all sizes a‹ross Canada. Our flexibleABL solutions allow clients to unlock working capital from their accounts recelvable, inventory and equipment Mth facilities ranging upto 510 mIIIion,Accord ABL is the ideal solution for growing middle-market businesses. Forty-elghtyears of superior service across a broad spectrum ofIndustries makes us the finance paMerof cholce for companies positioning for thelr next phase of growth.

Sn nll P siness Finv»°ce

Accord provides a variety of financing solutions for Canadian entrepreneurs. including equlpment leasing and flexible working capital facilities. Under the AccordExpress banner, we offer a range ofInnovative programs designed with astreamlined approval process and fast fundlng These programs deliver up to S250,oXi of working capital, and up to S3 mlllion when backed by receivables or equipment collateral, allMth flexible terms designed to spur growth In 2026.

Accord has been factoring smail-and medium-slzed companies for nearly fifty years. Factodng - buytng cllents'accounts receivable - accelerates cash flow by unlocklng the value of receNabtes for cash. in addldon to Improving liquldlty, factoring ako saves management time often tied up with cash flow planning, credit analysts and collections. Our experienced team has worked with companies In virtually every industry, whkh allows us toprovide qulck credlt approval for companies in tranutlonor shiftinglntogrowth mode.

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Message From the President and CEO Management's Discussion and Analysis

Consolidated Statements of Financial Position (Unaudited) Consolidated Statement of Earnings (Unaudited)

Consolidated Statement of Comprehensive Income (Unaudited) Consolidated Statements of Changes in Equity (Unaudited) Consolidated Statements of Cash Flows (Unaudited)

Notes to the Consolidated Financial Statements

Inside back cover Corporate Information

Enclosed are the financial statements, as well as Management's Discussion and Analysis, for the quarter ended June 30, 2026, together with comparative figures for the second quarter of 2025, and December 31, 2025. These financial statements have not been reviewed by the Company's auditors but have been reviewed and approved by its Audit Committee and Board of Directors.

During the first half of 2026, the Company successfully executed a series of important strategic initiatives. In mid-February the Company sold its 60% interest in BondIt Media Capital, and in mid-March the Company announced the sale of certain US ABL portfolio assets. By the end of the first quarter Accord successfully exited the US market, to refocus on SME lending in Canada - one country, one target market, one team. Through these and other initiatives, the outstanding balance on Accord's senior credit facility ("Bank Facility") was reduced from approximately $148 million as at December 31, 2025 to approximately $55 million at June 30, 2026.

This progress paved the way for a longer-term extension of the Bank Facility, now maturing October 31, 2026. Further, on July 27th, the Company announced that holders of its listed and unlisted debentures ("Debentures"), with principal outstanding of $26.7 million, approved amendments including extending the maturity date of the Debentures from July 31, 2026 to October 31, 2031 (provided that if the Company doesn't refinance its Bank Facility by December 31, 2026, the Debentures will instead mature on October 31, 2027), and providing the Company flexibility to pay interest in cash or continue to accrue (as has been the case since July 1, 2025). The Company also announced similar amendments to the terms of unsecured demand notes and term notes held by the Hitzig family ("Hitzig Notes"), representing principal outstanding of approximately $11 million, reducing the interest rate to 0% for two years from July 31st, and mirroring the maturity dates of the Debentures.

Exiting the US, simplifying the portfolio, and extending the Debentures and Hitzig Notes is intended to set the stage to refinance the Bank Facility - we continue to work with our financial advisors in this regard, aiming for a fourth quarter transaction. If

successful, Accord can get back to the business of growing. As I wrote in the first quarter report, Accord's nearly fifty years of Canadian market presence opens doors with well-earned name recognition and respect. And the industry's broadest SME product suite, powered by unique strategic partnerships, means we're well-positioned to compete. These factors combined to boost Accord's SME lending performance in the years leading up to the current series of challenges. With our focus back on our core market, our mission is to restore the growth trajectory interrupted in late 2023.

"Accord 2.0" is positioned to compete in the market we know best, however, the effort to refocus and repay debt has put us at a suboptimal scale. The Company has reduced overhead as earning assets declined, however, it's not possible to precisely match cost-cutting to the revenue decline. The first half numbers reflect this challenge, compounded by the continuing burden of professional and other fees related to managing and repaying our bank syndicate. Accord must grow again, but meaningful growth requires that we refinance the Bank Facility first.

While progress has been made, there are no assurances that we will be able to fully repay our outstanding debt when due or that our lenders will grant further extensions. There remains a material uncertainty as to the Company's ability to continue as a going concern. See management's discussion & analysis below including the sections entitled "Liquidity and Capital Resources," "Risks and Uncertainties" and "Outlook" as well as notes 2 and 15 to the consolidated financial statements that follow.

The final steps to restructure, refinance and repay outstanding debt is the Company's top priority. As Accord manages through these challenges, our core mission continues - delivering much-needed capital to companies from coast to coast.

Simon Hitzig

President and Chief Executive Officer August 14, 2026

(in thousands of Canadian dollars, except v alues per share, or as otherwise noted)

Three months ended June 30,

Six months ended June 30,

The following discussion and analysis explain trends in Accord Financial Corp.'s ("Accord" or the "Company") results of operations and financial condition for the quarter and six months ended June 30, 2026 compared with the quarter and six months ended June 30, 2025 and, where presented, the year ended December 31, 2025. It is intended to help shareholders and other readers understand the dynamics of the Company's business and the factors underlying its financial results. Where possible, issues have been identified that may impact future results.

This Management's discussion & analysis ("MD&A"), dated August 14, 2026, should be read in conjunction with the Company's condensed interim unaudited consolidated financial statements (the "Statements") and notes thereto for the quarter and six months ended June 30, 2026 and 2025, which are included as part of this 2026 Second Quarter Report, and as an update to the discussion and analysis provided in the Company's 2025 Annual Report, which includes the audited consolidated financial statements and notes thereto for the fiscal year ended December 31, 2025.

All amounts discussed in this MD&A are expressed in thousands of Canadian dollars, except per share amounts and as otherwise noted and have been prepared in accordance with IFRS Accounting Standards ("IFRS"). Please refer to the Critical Accounting Policies and Estimates section below and notes 2 and 3 to the Statements regarding the Company's use of accounting estimates in the preparation of its financial statements in accordance with IFRS. Additional information pertaining to the Company, including its Annual Information Form, is filed under the Company's profile with SEDAR at https://www.sedarplus.ca.

In this document and in other documents filed with Canadian regulatory authorities or in other communications, the Company may from time to time make written or oral forward-looking statements within the meaning of applicable securities legislation. Forward-looking statements include, but are not limited to, statements regarding the Company's business plan and financial objectives. The forward-looking statements contained in this MD&A are used to assist readers in obtaining a better understanding of the Company's financial position and the results of operations as at and for the periods ended on the dates presented and may not be appropriate for other purposes. Forward-looking statements typically use the conditional, as well as words such as prospect, believe, estimate, forecast, project, expect, anticipate, plan, may, should, could and would, or the negative of these terms, variations thereof or similar terminology. By their very nature, forward-looking statements are based on assumptions and involve inherent risks and uncertainties, both general and specific in nature. The Company operates in a dynamic environment that involves various risks and uncertainties, many of which are beyond its control, which could have an effect on the Company's business, revenues, operating results, cash flow, financial condition and prospects. It is therefore possible that the forecasts, projections and other forward-looking statements will not be achieved or will prove to be inaccurate. Although the Company believes the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. The Company cautions readers against placing undue reliance on forward-looking statements when making decisions, as actual results could differ considerably from the opinions, plans, objectives, expectations, forecasts, estimates and intentions expressed in such forward-looking statements due to various factors. Among others, these factors include: the ability of the Company to continue to carry on as a going concern, dependence on continuing availability of capital resources and financing; maturing debt obligations and the availability of replacement financing on reasonable terms on a timely basis, or at all; the availability of further extension of debt maturities; the outcome of strategic initiatives; current state of economic conditions and business uncertainty and its impact on ECL, competition from alternative sources of capital; credit risk and ability to underwrite finance receivables and loan applications; interest rate risk; foreign currency risk; continuing partnerships with Crown corporations; dependence on key personnel; income tax matters; fraud by lessees, borrowers, vendors or brokers; technology and cyber security; data management and privacy risk; risk of future legal proceedings. The Company further cautions that the foregoing list of factors is not exhaustive. For more information on the risks, uncertainties and assumptions that would cause the Company's actual results to differ from current expectations, please also refer to "Risks and Uncertainties" in this MD&A and in the Company's Annual Information Form, as well as to other public filings of the Company available at https://www.sedarplus.com. The Company does not undertake to update any forward-looking statements, whether oral or written, made by itself or on its behalf, except to the extent required by securities regulation.

In addition to the IFRS prepared results and balances presented in the Statements and notes thereto, the Company uses a number of other financial measures to monitor its performance and some of these are presented in this MD&A. These measures may not have standardized meanings or computations as prescribed by IFRS that would ensure consistency and comparability between companies using them and are, therefore, considered to be non-IFRS measures. The Company primarily derives these measures from amounts presented in its Statements, which were prepared in accordance with IFRS. The Company's focus continues to be on IFRS measures and any other information presented herein is purely supplemental to help the reader better understand the key performance indicators used in monitoring its operating performance and financial position. The non-IFRS measures presented in this MD&A and elsewhere in the Company's 2026 Second Quarter Report are defined as follows:

1. Return on average equity ("ROE") - this is a profitability measure that presents net earnings attributable to shareholders ("shareholders' net earnings") as an annualized percentage of the average shareholders' equity employed in the period to earn the income. The Company includes all components of shareholders' equity, as shown on the Company's balance sheet, calculated on a month-by-month basis to calculate the average thereof;
2. Adjusted net earnings, adjusted earnings per common share and adjusted ROE -adjusted net earnings presents shareholders net earnings excluding restructuring and other non-recurring expenses. The Company considers these terms to be non-operating expenses. Management believes adjusted net earnings provides a more meaningful measure of ongoing operating performance than shareholders' net earnings as it excludes items which do not directly relate to ongoing operating activities. Adjusted (basic and diluted) earnings per common share is adjusted net earnings divided by the (basic and diluted) weighted average number of common shares outstanding in the period (see note 2 to the Statements), while adjusted ROE is adjusted net earnings for the period expressed as an annualized percentage of the average shareholders' equity employed in the period;
3. Book value per share - book value is defined as shareholders' equity and is the same as the net asset value of the Company (calculated as total assets minus total liabilities) less non-controlling interests in subsidiaries. Book value per share is the book value, or shareholders' equity, divided by the number of common shares outstanding as of a particular date; and
4. Average funds employed - Funds employed is another name that the Company uses for its finance receivables and loans (also referred to as "Loans" in this MD&A), an IFRS measure. Average funds employed are the average finance receivables and loans, calculated on a month-by-month basis, over a defined period.

Accord is one of Canada's leading independent finance companies serving clients from coast to coast. Accord's flexible finance programs cover the full spectrum of asset-based lending ("ABL"), including receivables and inventory finance, equipment and trade finance, and working capital finance. Its clients operate in a wide variety of industries, as summarized in the industry tables below.

Founded in 1978, the Company operates three finance companies in Canada, namely, Accord Financial Inc. ("AFIC"), Accord Financial Canada Corp. ("AFCC") and Accord Financial Ltd. ("AFL"), and formerly operated Accord Financial, Inc. ("AFIU") in the United States, which discontinued operations in Q1 2026.

The Company's business principally involves: (i) asset-based lending by its Canadian operations, which entails purchasing receivables ("factoring") or financing receivables on a recourse basis, as well as financing other tangible assets, such as inventory and equipment; and (ii) equipment financing (leasing and equipment loans) and working capital financing to SMEs by AFCC.

Until being discontinued in the second quarter of 2026, these activities also included similar asset-based lending operations conducted in the United States through AFIU.

During 2025 and into 2026, Accord refocused its new business origination efforts on SME lending in Canada as part of broader strategic initiatives aimed at streamlining operations and strengthening the Company's capital structure. These efforts were intended to better position the Company to refinance or repay its outstanding indebtedness while establishing the foundation of "Accord 2.0" - a more focused, scalable platform designed to serve the evolving needs of the Canadian SME market through a diverse suite of financing solutions.

* basic and diluted

** due to rounding the total of the four quarters may not agree with the total for the fiscal year

*** figures reflect results from continuing operations only.

Quarter ended June 30, 2026 compared with the quarter ended June 30, 2025

The following discussion relates to the results of operations for the quarter ended June 30, 2026 compared with the quarter ended June 30, 2025, and reflects results from continuing operations only, excluding discontinued operations.

Shareholders' net loss for the quarter ended June 30, 2026 was $2,790 compared to shareholders' net loss of $353 in the same quarter of 2025. The increase in net loss year over year was primarily driven by lower interest revenue and elevated professional fees associated with strategic initiatives. Basic and diluted loss per common share ("LPS") was $0.33 compared to basic and diluted LPS of $0.04 in the second quarter of 2025.

Revenue for the second quarter of 2026 declined by 22.3%, or $1,964, to $6,824 compared to $8,788 in the same period last year. Interest income decreased by 24.3%, or $1,835, to $5,706, from $7,541 primarily due to a $245.0 million decline in average funds employed and lower average interest rates. Other income was relatively stable, decreasing by $129 to $1,118 compared to $1,247 in the second quarter of 2025.

Total expenses increased 19.1% or $1,622 to $10,110 in the second quarter of 2026 from

$8,488 in the same period last year. Interest expense increased by 4.2%, or $110 to

$2,711 primarily due to amendment and extension fees incurred in connection with the Company's bank indebtedness, which are required to be recognized as interest

expense. G&A expenses increased by 39.9%, or $1,801, from the second quarter of 2025 mainly due to higher professional fees associated with increased strategic initiative activities (2026 - $1,491, 2025 - $135). G&A expenses are comprised of personnel costs, which represent the largest component, as well as professional fees, information technology expenses, and portfolio servicing costs, among others. The Company continues to closely manage its controllable expenses.

The provision for credit losses decreased by $315 to $974 in the second quarter of 2026 compared to $1,289 in the same quarter last year.

Net write-offs increased by $1,295 to $2,396 in the second quarter of 2026 compared to $1,101 last year. Of the $2.4 million of write-offs recognized in the second quarter,

$1.8 million are related to certain asset-based loans, while the remaining $616 are related to small business loans and are consistent with management expectations. The non-cash allowance for expected credit losses ("ECL") decreased by $1,610, primarily due to a reduction in the general provision resulting from lower portfolio balances related to continuing operations compared to the same period in 2025. While the Company manages its portfolio of Loans closely, as noted in the Risks and Uncertainties section below, financial results can be impacted by individually significant insolvencies or losses.

Depreciation expense increased by $26 to $110 (2025 - $84) in the second quarter of 2026. Depreciation of $84 (2025 - $59) was charged on the Company's right-of-use assets in the second quarter of 2026, while the balance of the expense related to capital assets.

There was a recovery of income tax expense of $496 in the second quarter of 2026 compared to an income tax expense of $653 in the same period last year.

Six months ended June 30, 2026 compared with six months ended June 30, 2025

Shareholders' net loss for the first half of 2026 was $3,903 compared to a net loss of

$1,217 in the first half of 2025. Shareholders' net loss increased compared to 2025 primarily due to a combination of lower interest revenue due to lower average funds employed and higher professional fees associated with strategic initiatives, offset by lower provision for credit losses. Basic and diluted LPS were $0.46 compared to of $0.14 in the first half of 2025.

Revenue for the first half of 2026 declined by 18.0% or $3,091 to $14,087 compared to

$17,178 last year. Interest income declined by 20.7% or $3,102 to $11,892 compared to

$14,994 in the first half of 2025 primarily due to $177.7 million decrease in average funds

employed and slightly lower average yields. Other income increased by 0.5% to $2,195 compared to $2,184 in the first half of 2025.

Total expenses for the first half of 2026 increased by 1.7% or $317 to $18,543 compared to $18,226 last year. Interest expense increased by 15.5% to $5,719 compared to $4,953 in the first half of 2025 due primarily to amendment and extension fees incurred in connection with the Company's bank indebtedness. G&A increased by 13.2% or

$1,305 to $11,159 in the first half of 2026 compared to $9,854 last year, primarily due to higher professional fees incurred in connection with strategic initiatives (2026 - $2,202, 2025 - $234) and targeted spending on technology.

The provision for credit losses decreased by $1,775 to an expense of $1,476 in the first half of 2026 compared to an expense of $3,251 last year. The provision comprised:

Net write-offs of $2.5 million related to small business loans (AFCC) while $1.8 million relates to certain asset-based loans (AFIC), including $1.0 million related to the Company's largest exposure (see discussion under Review of Financial Position - Gross finance loans and receivables). The remainder of the decrease in the non-cash allowance primarily reflects the reduction in the size of the Loan portfolio compared to the prior year. While the Company actively manages its portfolio closely, as discussed in the Risks and Uncertainties section below, financial results can be adversely affected by individually significant insolvencies or credit losses.

Depreciation expense increased by $21 to $189 (2025 - $168) in the first half of 2026. Depreciation of $143 (2025 - $118) was charged on the Company's right-of-use assets in the first half of 2026, while the balance of the expense related to capital assets.

The Company recognized an income tax recovery of $553 in the first half of 2026, compared to an income tax expense of $169 in the corresponding period of 2025.

Shareholders' equity declined to $43.7 million at June 30, 2026, compared to $51.0 million at December 31, 2025. Book value per common share was $5.11 at June 30, 2026 compared to $5.96 at December 31, 2025.

Total assets were $165.4 million at June 30, 2026, a decrease of 53.6% from $356.7 million at December 31, 2025. The decrease from December 31, 2025 primarily reflects the disposition of Loans from the U.S. loan portfolio at AFIU and the sale of the Company's 60% ownership interest in BondIt in the first quarter of 2026.

Gross finance receivables and loans, before the allowance for ECL, decreased to

$141.9 million at June 30, 2026 from $346.0 million at December 31, 2025. As detailed in the Statements, the Company's Loans comprised:

The Company's Loans principally represent asset-based lending advances to approximately 19 clients (December 31, 2025 - 36), and lease receivables, equipment finance and working capital loans to approximately 462 clients (December 31, 2025 -590). These lending activities were conducted through AFIC (and previously AFIU) and AFCC, respectively. There were no media finance loans outstanding (previously originated through BondIt) as at June 30, 2026 (December 31, 2025 - 50).

The largest client in the loan portfolio comprised 19.0% of gross Loans at June 30, 2026 (December 31, 2025 - 8.5%). The increase in concentration is related to the decrease in the size of the Company's portfolio, and not the result of a significant increase in exposure. The exposure is partially secured by accounts receivable and inventory and is being closely monitored given its classification as a Stage 2 loan. At June 30, 2026, the outstanding balance was $26.9 million, of which $8.0 million represented unsecured over-advances (December 31, 2025, $29.4 million outstanding, including

$8.5 million of unsecured over-advances). In June 2026 one of the client's major customers emerged from bankruptcy. As a result, approximately $1.7 million of related receivables were collected, representing a recovery of approximately 25% of pre-bankruptcy receivables owing from that customer. In addition, $5.0 million of the outstanding exposure was in the form of a loan partially guaranteed by EDC. A claim under that guarantee has been submitted, resulting in the recognition of a $1.0 million write-off during the second quarter of 2026, representing the portion of that loan not covered by the guarantee. Management expects the remaining $4.0 million to be recovered, subject to approval of the EDC claim. The borrower's operating performance has improved in 2026; however, management continues to closely monitor its operating performance, liquidity and collateral position in light of its financial challenges.

An ECL allowance for this client, including a judgmental overlay, has been recognized in an amount that Management considers reasonable and supportable based on information currently available, including expectations regarding recoveries from collateral, the EDC guarantee and the client's ongoing operations. However, if certain conditions persist or further deteriorate - including adverse developments arising from

the restructuring process of its major customer, the ongoing impact of tariffs, or other unforeseen developments, the allowance recorded for this exposure may ultimately prove to be insufficient. Note 15 to the Statements provides details of the Company's credit exposure by industrial sector.

Credit approval for transactions is delegated to senior credit officers. Transactions with credit risk exposure exceeding $1.0 million require approval from the Corporate Credit Committee (comprised of the Company's President and CEO and its CFO). Transactions with credit risk exposure over $2.5 million must be approved by the Board of Directors. The Company actively monitors and manages its risk and exposures through established financial, credit and systems controls and believes it has effective procedures in place to assess and mitigate the credit risks to which it is exposed. Credit risk is subject to ongoing management review. Nevertheless, despite these controls, defaults by clients or their customers may occur for a variety of reasons.

For its factoring products, the Company's primary focus continues to be on the creditworthiness and collectability of its clients' receivables. The clients' customers have varying payment terms depending on the industries in which they operate, although most customers have payment terms of 30 to 60 days from invoice date.

Receivables become "ineligible" for lending purposes when they reach a certain predetermined age, typically 75 to 90 days from invoice date, and are usually charged back to clients, thereby limiting the Company's credit risk on older receivables. Asset-based lending products additionally require focus on the performance of other collateral types (inventory, equipment and in certain cases real estate) as well as the underlying cash flows of the borrower. Lease receivables and equipment finance and working capital loans are usually structured as term loans with payments spread out evenly over the term of the lease or loan, with terms up to 60 months. Th Company also has revolving loan products which can be repaid at any time.

The Company uses a credit risk rating system for assessing obligor and transaction risk for finance receivables and loan exposures. Risk rating models use internal and external data to assess and assign ratings to borrowers, predict future performance and manage limits for existing loans and collection activities. The credit rating of the borrower is used (in addition to other criteria) to assess the predicted credit risk for each initial credit approval or significant account management action. Credit ratings improve credit decision quality, adjudication time frames and consistency in the credit decision process and facilitate risk-based pricing. Please see note 5 to the Statements which presents tables summarizing the Company's finance receivables and loans, by the three stage credit criteria of IFRS 9, Financial Instruments ("IFRS 9"), as well as an aged analysis thereof. Credit risk is managed by ensuring that, as far as possible, the receivables financed are of good quality and any inventory, equipment or other assets securing loans are appropriately appraised. Collateral is monitored and managed on an on-going basis to mitigate credit risk. In its asset-based lending and equipment finance operations, the Company assesses the financial strength of its clients and its clients' customers and the industries in which they operate on a regular

and ongoing basis. Cash flows from a client's ongoing business operations represent the primary source of repayment.

The Company also manages credit risk through a combination of underwriting controls and ongoing portfolio monitoring, including the application of advance rates, the exclusion of certain types of receivables, and the aging out or ineligibility of receivables for lending purposes as they become more delinquent. In certain circumstances, the Company also obtains cash collateral. The Company also performs verification procedures on receivables that are purchased or financed. In its factoring operations, the Company administers and collects the majority of its clients' receivables, which enables it to identify emerging credit issues on a timely basis and take prompt action to mitigate potential losses. Security deposits are generally required for equipment leases and loans, while the majority of working capital loans are supported by a strong financial guarantor, typically covering 75% of the principal balance of the loan in the event of a default.

As detailed in note 5 to the Statements, the Company had past due finance receivables and loans of $9,171 at June 30, 2026, of which $8,471 relates to AFCC. As of June 30, 2026, 25.1% or $35,577 of total finance receivables and loans were considered to have had a significant increase in credit risk ("SICR"), including the Company's largest client exposure, which is classified as a Stage 2 loan and is being closely monitored.

The Company had impaired finance receivables and loans of $2,331 at June 30, 2026 representing 1.6% of total funds employed. The impaired loans, most of which have been written down to estimated fair value, are mainly secured by collateral comprised of receivables, inventory and/or equipment or backed by a guarantee from a creditworthy party. The estimated fair value of the impaired loans was $1,977 at June 30, 2026. Since the Company's finance receivables and loans are secured or backed by a guarantee, past due or impaired loans do not necessarily lead to a significant ECL, as the estimated fair value of the underlying collateral or guarantees often results in a low or nil loss given default ("LGD") for such exposures.

The Company's credit exposure relating to its finance receivables and loans by industrial sector were as follows:

The Company maintains an allowance for ECL on its Loans at amounts which, in management's judgment, are adequate to cover ECL. The Company's allowance for ECL on Loans, calculated under the ECL criteria of IFRS 9, totalled $14,616 at June 30, 2026 compared to $19,045 at December 31, 2025. This represents management's best estimate of ECL based on information available at those dates. The challenging economic environment continues to affect the Company's loan portfolio to varying degrees and the measurement of the allowance could fluctuate substantially in future periods. (See "Critical Accounting Policies and Estimates" and "Risks and Uncertainties" and notes 2 and 15 to the Statements).

The activity in the allowance for ECL in the first six months of 2026 and 2025 is set out in note 5 to the Statements. The estimates of the allowances for ECL involve judgment which management considers to be reasonable and supportable.

Assets held for sale, reported at lower of cost or fair value less cost of disposal, totalled

$280 at June 30, 2026 (December 31, 2025 - $425) and comprised of certain assets securing defaulted finance receivables and loans from a number of clients and repossessed long-lived assets.

Cash decreased to $5,568 at June 30, 2026 compared to $6,990 at December 31, 2025. The Company endeavors to minimize cash balances as far as possible when it has bank indebtedness outstanding. Fluctuations in cash balances are normal.

Other assets increased by $9,347 to $17,682 at June 30, 2026 compared to $8,335 at December 31, 2025. The largest component of other assets represents $11,917 (December 31, 2025 - $5,682) due from Export Development Canada ("EDC") related to claims made on defaulted loans which benefit from an EDC guarantee ranging from 75% to 80% of the defaulted loans principal balance. Other assets also include an investment of $2,467 (December 31, 2025 - nil), in a media finance and services business in the U.S. which was acquired as partial consideration in connection with the sale of BondIt, other loans of $2,044 (December 31, 2025 - $136), prepaid expenses

$734 at June 30, 2026 (December 31,2025 - $1,297), an amount held as a security for

non-recourse borrowings of $ 502 (December 31, 2025 - $773) as well other miscellaneous assets of $18 (December 31, 2025 - $447).

Net deferred tax assets increased to $11,982 at June 30, 2026 compared to $11,240 at December 31, 2025.

Income taxes receivable and property and equipment at June 30, 2026 and December 31, 2025 were not significant.

Total liabilities decreased by $181.2 million to $121.7 million at June 30, 2026 compared to $302.9 million at December 31, 2025. The decrease since December 31, 2025 was primarily due to a decrease in bank indebtedness and loans payable, resulting from the disposition of U.S. loan portfolio at AFIU and the sale of the Company's 60% ownership interest in BondIt in the first quarter of 2026.

Bank indebtedness decreased by $93,242 or 62.9% to $54,994 at June 30, 2026 compared to $148,236 at December 31, 2025, reflecting lower revolving credit facility usage.

On June 12, 2026, the maturity date of the Senior Credit Facility was extended to October 31, 2026, as the Company's senior lenders er provide additional time to complete a refinancing. Pursuant to the amendment, the maximum facility commitment was reduced to $70.0 million and specific milestones were established to support the refinancing of upcoming debt maturities.

Pricing for drawn amounts under the revolving credit facility are primarily based on the Canadian Overnight Repo Rate Average ("CORRA") plus a margin for Canadian dollar borrowings or the secured overnight financing rate ("SOFR") plus a margin for

U.S. dollar borrowings. The margin is based on a measure of leverage at each month end.

The Company was in compliance with all covenants at June 30, 2026 and December 31, 2025. Subject to other debt borrowings, bank indebtedness principally fluctuates with the amount of funds employed. Please refer below to "Liquidity and Capital Resources" for further details.

Loans payable decreased by $82,964 to $7,346 at June 30, 2026 compared to $90,310 at December 31, 2025. The decrease primarily reflects the refinancing and subsequent repayment of the revolving loan previously extended to BondIt in connection with its sale on February 10, 2026. (See discussion under Liquidity and Capital Resources).

Accounts payable and other liabilities increased by $1,117 to $9,378 at June 30, 2026 compared to $8,261 at December 31, 2025.

Notes payable decreased by $6,844 to $18,231 at June 30, 2026, compared to $24,075 at December 31, 2025, primarily reflecting the derecognition of notes payable by

BondIt upon the completion of its sale. Notes payable comprised (i) $4,550 (December 31, 2025 - $4,500) of unsecured demand notes, which are due on or within a week of demand and bear interest at variable rates tied to the bank prime rate; and (ii)

$13,681 (December 31, 2025 - $13,027) of unsecured term notes issued to related and third parties, with a maturity date of November 6, 2026. These notes bear interest at a fixed rate of 10.0% per annum, payable quarterly. However, pursuant to the terms of the Company's Senior Credit Facility, cash interest payments are currently suspended and continue to accrue. Subsequent to June 30, 2026, the terms of these notes were amended. Please refer to "Liquidity and Capital Resources" below for further details. The December 31, 2025 balance also included $7,548 of notes payable by BondIt, which were disposed of upon the sale of BondIt.

Debentures with a face value of $25,650 (25,650 debentures of $1,000 each) were issued by the Company in 2018 and 2019. Of these, 20,650 debentures are listed for trading ("Listed Debentures") on the Toronto Stock Exchange ("TSX"), while 5,000 are unlisted ("Unlisted Debentures"). All Debentures are unsecured and subordinated to all senior indebtedness which is defined to include all debt for borrowed money, such as principal, interest and fees related to bank indebtedness, the unsecured demand notes and the unsecured term notes along with other material obligations under lease liabilities, trade payables and financial instruments such as letters of credit. It also encompasses related guarantees, accrued interest and enforcement costs, unless expressly subordinated or stated to rank pari passu with the Debentures. The Debentures accrue interest which is payable semi-annually on June 30 and December 31 of each year. As of December 31, 2025, the lenders prohibited the payment of accrued interest causing a default under the Debentures, which was subsequently waived by Debentureholders pursuant to an amendment to the terms of the Debentures at a meeting held on January 27, 2026. At June 30, 2026, the debt component of all Debentures, inclusive of accrued interest, totalled $28,565 compared to $26,966 at December 31, 2025. This amount represents the IFRS carrying amount of the debt component of the Debentures and differs from the aggregate principal and accrued interest contractually payable to debentureholders, which was

$28,504 at June 30, 2026. Subsequent to June 30, 2026, the terms of the Debentures were amended. Please refer below to "Liquidity and Capital Resources" for further details.

Income taxes payable, lease liabilities and deferred income at June 30, 2026 and December 31, 2025 were not significant.

Capital stock totalled $9,448 at June 30, 2026 and December 31, 2025. There were 8,558,913 common shares outstanding at those dates.

Contributed surplus totalled $1,893 at June 30, 2026 (December 31, 2025 - $1,886). Retained earnings decreased by $6,024 to $26,476 at June 30, 2026 compared to

$32,500 at December 31, 2025. The decrease in 2026 is due to a net loss from

continuing operations of $3,903 and a net loss from discontinued operations of $2,121.

The Company's accumulated other comprehensive income ("AOCI") represents the cumulative unrealized foreign exchange income or loss arising on the translation of the assets and liabilities of the Company's foreign operations. The AOCI balance decreased to $5,877 at June 30, 2026 compared to $7,157 at December 31, 2025. Although the Company has classified its former U.S. operations as discontinued operations, the related cumulative foreign currency translation adjustments remain in AOCI as at June 30, 2026 because the Company continues to have certain residual interests, obligations and intercompany balances associated with the former U.S. operations. Accordingly, the foreign operations have not yet been fully liquidated or settled for accounting purposes.

Non-controlling interests in subsidiaries totalled $nil at June 30, 2026 compared with

$2,839 at December 31, 2025.

The Company's capital resources consist primarily of shareholders' equity and debt, including its Senior Credit Facility, loans payable, notes payable and Debentures. Management continues to actively manage the Company's capital resources to meet its financial obligations, maintain compliance with lender requirements, support ongoing operations and continue as a going concern.

The following table summarized the Company's debt obligations outstanding as at June 30, 2026:

Borrower Amount Maturity Date

Secured Non-recourse loan ASBF 7. 3 million Amortizing from asset cash flows Total 109. 2 million

* Note: Amount includes interest accrued to date

Subsequent to quarter end, the Company completed several strategic financial initiatives intended to provide additional time to implement a longer-term financing strategy.

On June 12, 2026, the Company's Senior Credit Facility was amended to extend its maturity date to October 31, 2026. As part of the amendment, the maximum facility commitment was reduced from $97.5 million to $70.0 million and new milestones were established relating to the restructuring and refinancing of the Company's upcoming debt maturities. The amendment provides additional time for the Company to pursue a comprehensive refinancing of its senior debt.

On July 27, 2026, holders of the Company's unsecured subordinated Debentures approved amendments to the terms of the Debentures. The amendments include:

1. extending the maturity date from July 31, 2026 to October 31, 2031, provided the Company refinances its Senior Credit Facility by December 31, 2026, failing which the Debentures mature on October 31, 2027;

2. decreasing the interest rate from 12.0% to 7.0% per annum effective July 31, 2026 and providing the Company with the flexibility to pay interest in cash or continue to accrue interest; and

3. providing for repayment of 103% of principal (plus any accrued and unpaid interest) upon a change of control occurring after December 31, 2026.

Also on July 27, 2026, the Company amended the terms of approximately $11.0 million of related-party unsecured notes held by the Hitzig family. The amendments include:

1. extended the maturity date of the Hitzig Notes from July 31, 2026 to October 31, 2031, subject to the same Refinancing Condition applicable to the Debentures,

2. reduced the interest rate to 0% for two years until August 1, 2028, after which interest will accrue at 7.0% per annum, with the Company having the option to pay interest in cash or continue to accrue,

3. reducing the ranking of the Hitzig Notes so that they rank pari passu with the Company's unsecured subordinated Debentures; and

4. adding a conversion option to the holder upon an offering of equity by the Company any time after July 31, 2026.

Collectively, these amendments extend the maturity profile of a significant portion of the Company's indebtedness and provide additional flexibility while Management continues to pursue a comprehensive refinancing plan.

As of June 30, 2026, the Company had financial liabilities of $120.8 million maturing over the next 12 months. Management continues to pursue refinancing opportunities for its outstanding indebtedness and is evaluating potential sources of debt and equity capital. However, there is a risk that the availability of options to refinance the debt that matures in 2026 may not be available on terms acceptable to the Company or at all, or that existing lenders will continue to extend debt maturities.

The Company believes that additional debt and equity capital will be required to refinance existing debt and support future operations and growth. If the Company is unable to successfully refinance or replace its existing funding sources on acceptable terms, the Company may not have sufficient liquidity to continue operations, which could have a material adverse impact on its business. These conditions represent a material uncertainty that casts significant doubt on the Company's ability to continue as a going concern. (See Outlook, Risks and Uncertainties and note 2 to the Statements).

Cash flow for the six months ended June 30, 2026 compared with the six months ended June 30, 2025

Cash outflow from net loss before changes in operating assets and liabilities and income tax payments was $5,100 in the first six months of 2026 compared to a cash inflow of $2,223 last year. After changes in operating assets and liabilities and income tax payments or refunds are taken into account, there was a net cash inflow from operating activities of $54,202 in the first six months of 2026 compared to an outflow of $39,429 last year. A net cash inflow of $64,922 in the first six months of 2026 was primarily due loan repayments primarily at AFIC and AFIU. The net cash outflow of

$46,066 in the first six months of 2025 largely resulted from funding of new and existing Loans partially offset by Loan repayments. Changes in other operating assets and liabilities are discussed above and are detailed in the Company's consolidated statements of cash flows.

Cash inflows from investing activities totalled $47,255 in the first six months of 2026, primarily representing proceeds from the sale of BondIt and Loans at AFIU. Cash flows from investing activities totalled $2 in the first six months of 2025.

Net cash outflow from financing activities totalled $104,591 in the first six months of 2026 compared to an inflow of $24,468 last year. The net cash outflow this year primarily resulted from a decrease in bank indebtedness of $93,243, net repayment of

U.S. dollar loans payable of $3,202 and repayment of Canadian dollar loans payable of $7,980. In the first six months of 2025, the net cash inflow primarily resulted from an increase in bank indebtedness of $27,299 and net proceeds from U.S. dollar loans payable of $11,044, partially offset by repayment of Canadian dollar loans payable of $13,671.

The effect of exchange rate changes on cash was an increase of $1,712 in the first six months of 2026 compared to an increase of $5,836 in the first six months of 2025.

Overall, there was a net cash outflow of $1,422 in the first six months of 2026 compared to a net cash outflow of $9,127 in the first six months of 2025.

Payments due in

1 year

years

years

The Company has borrowed funds on an unsecured basis from shareholders and other related parties in the form of notes payable and debentures, as summarized in the table below.

Hitzig Bros., Hargreaves & Co. Inc.* Director

$ 4,000,000

Ken Hitzig Founder $ 500,000

Hitzig Bros., Hargreaves & Co. Inc.* Director

Ken Hitzig Founder

Oakwest Corporation Inc.** Shareholder

$ 4,000,000

$ 2,500,000

$ 3,000,000

Hitzig Bros., Hargreaves & Co. Inc.* Director

Simon Hitzig Director

$ 750,000

$ 600,000

Hitzig Bros., Hargreaves & Co. Inc.* Director

* a director of Accord has an ownership interest in the Company

* * holds significant influence ov er the Company

* a director of the Company has an ownership interest in the Company

$ 3,250,000

Notes payable, inclusive of accrued interest totalled $18,231 at June 30, 2026 compared to $25,075 at December 31, 2025. These balances comprise: (i) unsecured demand notes of $4,550 (December 31, 2025 - $4,500); and (ii) unsecured subordinated term notes totalling $13,681 (December 31, 2025 - $20,575), which were originally repayable on June 19, 2026 and were subsequently extended to November 6, 2026.

Of the notes payable, $16,928 (December 31, 2025 - $21,433) inclusive of accrued interest was owing to related parties. Related party interest expense on these notes

$352 for the three months end June 20, 2026 (2025 - $410) and $691 for the six months ended June 30, 2026. (2025 - $704). Please refer to note 9 to the Statements.

Accord pays interest on its unsecured term notes at a rate of 10.00% and on its unsecured demand notes at a rate based on Canadian prime (4.45% at June 30, 2026).

The Company also had $3,250 of Unlisted Debentures maturing on July 31, 2026 held by a related party.

As at June 30, 2026, the Company had no related-party term notes issued by BondIt outstanding (December 31, 2025 - US$3.8 million).

Subsequent to quarter end, on July 27, 2026, all related-party notes and debentures, held by members of the Hitzig family, totalling approximately $15.6 million at June 30, 2026 were amended. Please refer to Liquidity and Capital Resources on page 16 for details of the amendments.

Financial assets and liabilities are recorded at amortized cost. Financial assets and liabilities, other than lease receivables and loans to clients, term loans payable and lease liabilities, are short term in nature and, therefore, their carrying values approximate fair values.

At June 30, 2026 and December 31, 2025, there were no outstanding foreign exchange contracts entered into by the Company.

A critical accounting estimate represents an estimate that is highly uncertain and for which changes in the estimate could materially impact the Company's financial results.

The Company considers the estimate of the allowance for ECL on Loans as critical to its financial results. The Company maintains allowances for ECL at amounts which, in management's judgment, are sufficient to cover credit losses thereon. The allowances are based upon several considerations including current economic environment, condition of the loan and receivable portfolios, typical industry loss experience, macro-economic factors and forward-looking information ("FLI"). The key inputs in the measurement of ECL allowances for each loan are as follows: (i) the probability of default ("PD") which is an estimate of the likelihood of default over a given time horizon; (ii) the LGD which is an estimate of the loss arising in the case where a default occurs at a given time; and (iii) the exposure at default ("EAD") which is an estimate of the exposure at a future default date. These key inputs associated with each loan are sensitized to future market and macro-economic conditions through the incorporation of FLI. These estimates are particularly judgmental, and operating results may be adversely affected by significant unanticipated credit or loan losses, such as occur in a bankruptcy or insolvency, or may result from severe adverse economic conditions.

The Company's allowance for ECL on its Loans is provided for under the three-stage criteria set out in IFRS 9, where a Stage 1 allowance is established to reserve against accounts which have not experienced a SICR and which cannot be specifically identified as impaired on an item-by-item or group basis at a particular point in time. Stage 1 ECL results from default events on the financial instrument that are possible within the twelve-month period after the reporting date. Stage 1 accounts are considered to be in good standing. The Company's Stage 2 allowances are based on a review of the loan and comprises an allowance for those financial instruments which

have experienced a SICR since initial recognition. Lifetime ECL are recognized for all Stage 2 financial instruments. Stage 3 financial instruments are those that the Company has classified as impaired. The Company classifies a financial instrument as impaired when the future cash flows of the financial instrument could be adversely impacted by events after its initial recognition. Evidence of impairment includes indications that the borrower is experiencing significant financial difficulties, or a default or delinquency has occurred. Lifetime ECL are recognized for all Stage 3 financial instruments. In Stage 3, financial instruments are written off, either partially or in full, against the related allowance for ECL when the Company judges that there is no realistic prospect of future recovery in respect of those amounts after the collateral has been realized or transferred at net recoverable value. Any subsequent recoveries of amounts previously written-off are credited to the respective allowance for ECL.

Management believes that its allowances for ECL, which require a high degree of reasonable and supportable judgment are sufficient and appropriate. The Company's allowances are discussed in notes 5 and 15 to the Statements.

Disclosure controls and procedures ("DC&P") are designed to provide reasonable assurance that all relevant information is gathered and reported to management, including the CEO and CFO, on a timely basis so that appropriate decisions can be made regarding public disclosure. Internal Controls over Financial Reporting ("ICFR") are designed by or under the supervision of the CEO and CFO, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. The CEO, CFO and other members of management have assessed the design effectiveness of the Company's DC&P and ICFR at June 30, 2026, and have concluded that the design of the Company's DC&P and ICFR were effective as of that date. During the six months ended June 30, 2026, there have been no significant changes to the Company's ICFR that would have or would be reasonably likely to materially affect the Company's ICFR.

Internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate and, as such, there can be no assurance that any design will succeed in achieving its stated goal under all potential conditions.

The Company's management, including its President and Chief Financial Officer, are responsible for establishing and maintaining the Company's disclosure controls and

procedures and has designed same to provide reasonable assurance that material information relating to the Company is made known to it by others within the Company on a timely basis. The Company's management has evaluated the effectiveness of its disclosure controls and procedures (as defined in the rules of the Canadian Securities Administrators ("CSA")) as at June 30, 2026 and has concluded that such disclosure controls and procedures are effective.

Past performance is not a guarantee of future performance, which is subject to substantial risks and uncertainties. Management remains optimistic about the Company's long-term prospects. Factors that may impact the Company's results include, but are not limited to, the factors discussed below. Please refer to note 15 to the Statements.

The Company's ability to continue operations depends on achieving future profitability and securing additional equity and/or debt financing. Additional funding will be required to repay or refinance existing debt obligations. In addition to refinancing existing debt, the Company will require an injection of new equity or debt to fund operations and growth. The Company is working with external advisors to pursue strategic initiatives to repay or refinance its debt obligations, however, there can be no assurance that these initiatives will be successful, completed on a timely basis or sufficient to address the Company's liquidity needs. These conditions give rise to a material uncertainty that casts a significant doubt on the Company's ability to continue as a going concern. Please also see comments regarding business conditions on page 22, Liquidity and Capital Resources on page 16 and note 2 to the Statements.

The Company depends on and will continue to depend on the availability of credit from external financing sources, to continue to, among other things, finance new and refinance existing loans and satisfy the Company's other working capital needs. The Company's senior lenders, while being supportive of strategic initiatives, have curtailed the Company's borrowing capacity through multiple amendments in 2025 and 2026 as they continue to press the Company to refinance its Senior Credit Facility.

The Company relies on current cash balances and existing credit lines, together with cash flow from operations, to meet its immediate cash requirements for working capital and operating expenditures. However, there is no guarantee that the Company will continue to have financing available to it to fund working capital or if the Company were to require additional financing that it would be able to obtain it on acceptable terms or at all.

As of June 30, 2026, the Company had approximately $55.0 million of bank indebtedness maturing on October 31, 2026, $13.7 million of term notes maturing on November 6, 2026 and $28.6 million of Debentures maturing on July 31, 2026. Subsequent to June 30, 2026, the terms of the Hitzig Notes and the Debentures were amended. Please refer to the Liquidity and Capital Resources section above for additional information.

If any or all of the Company's funding sources are not replaced or renewed on acceptable terms or if the Company is unsuccessful in generating sufficient additional capital through its strategic initiatives to repay its maturing debt, the Company may not have the financing necessary to continue operations, which could have a material adverse impact on its business, financial condition and results of operations. While the Company has been granted extensions of the maturity date of its outstanding debt, there is no guarantee that further extensions will be available. If the Company is unable to pay its bank indebtedness on the maturity date, the lenders could take steps to enforce their security. The above conditions represent a material uncertainty that casts significant doubt on the Company's ability to continue as a going concern. Please also see comments regarding business conditions on page 22, Liquidity and Capital Resources on page 16 and note 2 to the Statements.

The Company is actively pursuing strategic initiatives with the objective of generating proceeds to repay or refinance its outstanding debt obligations to set the foundation for Accord 2.0. While these initiatives are intended to improve the Company's liquidity and financial flexibility, they are subject to risks related to execution, valuation, market conditions, and lender or buyer interest. There can be no assurance that any transaction will be completed on acceptable terms or within the necessary timeframes. Sales of portfolio assets or subsidiaries may also lead to a decline in funds employed which may have an adverse impact on the Company's operating performance.

If the Company is unable to complete its strategic initiatives or arrange alternative financing, it may be unable to meet its obligations as they come due, resulting in a material adverse effect on its financial condition and ability to continue as a going concern.

The Company's operating results may be negatively impacted by various economic factors and business conditions, including the level of economic activity in Canada and the United States. Protectionist trade policies and the imposition of cross-border tariffs, whether broad based or targeted to specific industries, could affect input costs, lower investment and disrupt supply chains. Other potential negative conditions or significant events include public health emergencies including pandemics, geo-

political or military conflicts, sanctions and other trade disruptions, and related or unexpected changes in inflation and borrowing costs. To the extent that economic activity or business conditions deteriorate, delinquencies and credit losses may increase. As the Company extends credit primarily to small and medium-sized businesses, many of its customers are particularly susceptible to economic slowdowns or recessions and may be unable to make scheduled lease or loan payments during these periods.

Unfavorable economic conditions may also make it more difficult for the Company to maintain new origination volumes and the credit quality of new loans at levels previously attained. Unfavorable economic conditions could also increase funding costs or operating cost structures, limit access to credit facilities and other capital markets funding sources or result in a decision by the Company's lenders not to extend further credit. Any of these events could have a material adverse impact on the Company's business, financial conditions and results of operations.

Certain products that the Company offers are dependent on partnerships with investment-grade Crown corporations that may provide guarantees, risk transfers or other forms of financial support that enable the Company to offer such products. The loss, suspension, modification or non-renewal of any such arrangements could have a material adverse effect on the Company's business, financial condition and results of operations.

The Company operates in an intensely competitive environment and its results could be significantly affected by the activities of other industry participants. The Company expects this level of competition to persist in the future as the markets for its services continue to develop and as additional companies enter its markets. There can be no assurance that the Company will be able to compete effectively with current or future competitors. If the Company's competitors engage in aggressive pricing policies with respect to services that compete with those of the Company's, the Company would likely lose some clients or be forced to lower its rates, both of which could have a material adverse effect on the Company's business, financial condition and results of operations. In addition, some of the Company's competitors may have greater access to capital or have higher risk tolerances or different risk assessments, which could allow them to establish more origination sources and customer relationships to increase their market share. Further, because there are fewer barriers to entry to the markets in which the Company operates, new competitors could enter these markets at any time. Because of all these competitive factors, the Company may be unable to sustain its operations at its current levels or generate growth in revenues or operating income, either of which could have a material adverse impact on the Company's business, financial condition and results of operations.

The Company is in the business of financing its clients' receivables and making asset-based loans, including inventory and equipment financing, designed to serve small and medium-sized businesses, which are often owner-operated and have limited access to traditional financing. There is a high degree of risk associated with providing financing to such parties because of their lower creditworthiness. Even with an appropriately diversified lending business, operating results can be adversely affected by large bankruptcies and/or insolvencies. Losses from client loans in excess of the Company's expectations could have a material adverse impact on the Company's business, financial condition and results of operations. In addition, since defaulted loans as well as certain delinquent loans cannot be used as collateral under the Company's credit facilities, higher than anticipated defaults and delinquencies could adversely affect the Company's liquidity by reducing the amount of funding available to the Company under these financing arrangements. Furthermore, increased rates of delinquencies or defaults could cause the Company to be in breach of its financial covenants under its credit facilities and could also result in adverse changes to the terms of future financing arrangements available to the Company, including increased interest rates payable to lenders and the imposition of more burdensome covenants and increased credit enhancement requirements.

The Company has floating rate debt, as well as fixed rate debt. The Company's agreements with its clients (affecting interest revenue) and lenders (affecting interest expense) usually provide for rate adjustments in the event of changes in key interest rates, such as Prime, SOFR or CORRA. Fluctuations in interest rates may have a material adverse impact on the Company's business, financial condition and results of operations.

The Company has discontinued its United States operations; however, it continues to have certain assets and intercompany liabilities denominated in U.S. dollars. In recent years, the Company has seen the fluctuations in the U.S. dollar against the Canadian dollar affect its operating results when its foreign subsidiaries results are translated into Canadian dollars. It has also affected the value of the Company's net Canadian dollar investment in its foreign subsidiaries, which had, in the past, reduced the AOCI component of equity to a loss position, although it is now in a significant gain position. No assurances can be made that changes in foreign currency rates will not have a significant adverse effect on the Company's business, financial condition or results of operations.

Employees are a significant asset of the Company, and the Company depends to a large extent upon the abilities and continued efforts of its key operating personnel and senior management team. If any of these persons becomes unavailable to continue in such capacity, or if the Company is unable to attract and retain other qualified employees, it could have a material adverse impact on the Company's businesses (including its ability to originate new business opportunities), financial condition and results of operations. Market forces and competitive pressures may also adversely affect the ability of the Company to recruit and retain key qualified personnel.

The income tax of the Company must be computed in accordance with Canadian,

U.S. and foreign tax laws, as applicable, and the Company is subject to Canadian,

U.S. and foreign tax laws, all of which may be changed in a manner that could adversely affect the Company's business, financial condition or results of operation.

The Company may be a victim of fraud by lessees, borrowers, vendors or brokers. In cases of fraud, it is difficult and often unlikely that the Company will be able to collect amounts owing under a receivable or loan or repossess any related collateral. Increased rates of fraud could have a material adverse impact on the Company's business, financial condition and results of operations.

The Company remains focused on the confidentiality, integrity and availability of the information and cyber security controls that protect its network, data and infrastructure. The cyber security risk landscape includes numerous cyber threats such as hacking threats, identity theft, denial of service, and advanced persistent threats. These and other cyber threats continue to become more sophisticated, complex, and potentially damaging. Third party service providers that the Company uses may also be subject to these risks which can increase our risk of potential attack. The Company establishes the requirements and sets out the overall framework for managing cyber and information security related risks. These include developing and implementing the appropriate activities to detect, respond to and contain the impact of cyber security threats, along with implementing the appropriate safeguards to ensure the delivery of critical infrastructure services.

The Company is continuously improving the strength of its practices and capabilities. It works closely with our critical cyber security and software suppliers to ensure that its technology capabilities remain cyber resilient and effective in the event of any unforeseen cyber-attack. The Company has not experienced any material cyber security breaches and has not incurred any material expenses with respect to the

remediation of such cyber events. Security risks continue to be actively monitored and reviewed, leveraging the expertise of the Company's service providers and vendors, reviewing industry best practices and regularly re-assessing controls in place to acknowledge, address and mitigate the risks identified. The Company maintains a cyber security insurance policy to provide coverage in the event of cyber security incidents.

Data management and its governance are becoming increasingly important as the Company continues to invest in digital solutions and innovation and the ongoing expansion of business activities. Furthermore, there are regulatory compliance risks associated with data management and privacy. The Company establishes the requirements and sets out the overall framework for data management and managing privacy related risks.

The Company is threatened from time to time with, or is named as a defendant in, or may become subject to, various legal proceedings, fines or penalties in the ordinary course of conducting its businesses. A significant judgment or the imposition of a significant fine or penalty on the Company could have a material adverse impact on the Company's business, financial condition and results of operation. Significant obligations may also be imposed on the Company by reason of a settlement or judgment involving the Company, as well as risks pertinent to financing facilities, including acceleration and/or loss of funding availability. Publicity regarding involvement in matters of this type, especially if there is an adverse settlement or finding in the litigation, could result in adverse consequences to the Company's reputation that could, among other things, impair its ability to retain existing or attract further business. The continuing expansion of class action litigation in U.S. and Canadian court actions has the effect of increasing the scale of potential judgments. Defending such a class action or other major litigation could be costly, divert management's attention and resources and have a material adverse impact on the Company's business, financial condition and results of operations.

The Company pays dividends if, as and when declared by the board of directors. The Company suspended dividend payments in the fourth quarter of 2023 as a prudent measure to conserve cash and strengthen the Company's capital base. While the board will reassess the Company's dividend policy in the normal course, there is no assurance that the dividend will be reinstated at the same rate or at all.

The Company's near-term financial performance and its ability to operate as a going concern remain closely tied to the successful refinancing of its Senior Credit Facility and maintaining adequate financial flexibility in a challenging credit environment. During and subsequent to the quarter, the Company continued to execute its strategic refinancing plan. On July 27, 2026, holders of the Company's Debentures and the Hitzig Notes executed amendments extending the maturities of those obligations, subject to the terms of the amendments. These amendments were an important milestone in the Company's broader refinancing strategy, addressing near-term subordinated debt maturities and enhancing the Company's financial flexibility as it works toward completing a long-term refinancing of its Senior Credit Facility. The amendments also reflect the continued support of key stakeholders as the Company advances discussions with prospective senior lenders. At June 30, 2026, the Company has approximately, $55.0 million outstanding under is Senior Credit Facility which matures on October 31, 2026.

The Company continues to work with its lenders and financial advisors to refinance or replace its Senior Credit Facility and further strengthen its capital position. While management believes these initiatives are progressing constructively, they involve inherent execution risk and may be adversely affected by market conditions, lender negotiations and the availability of financing. Accordingly, there can be no assurance that the Company will successfully complete a refinancing on acceptable terms, or at all. These conditions continue to represent a material uncertainty that casts significant doubt on the Company's ability to continue as a going concern. For additional information, see the sections titled Business Conditions and Liquidity and Capital Resources, and Notes 2 and 15 to the Statements.

Credit risk remains a key priority as the Company continues to operate in an uncertain economic environment. During the quarter, the Company continued to closely manage higher risk clients and sectors, including its largest Stage 2 exposure in the wholesale trade sector. While management believes its ECL allowances are reasonable and supportable based on information currently available, changes in economic conditions, borrower performance or recovery expectations could result in additional provisions and adversely affect future operating results. The Company's lending teams remain focused on disciplined underwriting, proactive portfolio management, and the prudent deployment of available capital.

Operating results continue to be affected by elevated professional fees associated with strategic refinancing initiatives and ongoing lender negotiations, as well as and higher ECL provisions and severance costs incurred as part of the Company's restructuring activities. Management expects professional fees and severance costs associated with these initiatives to moderate as the refinancing process is completed and restructuring activities conclude. ECL provisions will continue to be influenced by borrower performance, economic conditions and the Company's assessment of credit risk. At the same time, the Company continues to make targeted investments

in technology, process improvements and operational efficiency initiatives that are expected to improve scalability and enhance long-term profitability.

Looking ahead, management and its advisors remain focused on repositioning the Company around its core Canadian lending operations following its exit from the U.S. market. The Company's strategic priorities include completing a long-term refinancing of its Senior Credit Facility, strengthening its capital position and continuing to optimize its operating platform. Management believes these initiatives will establish the foundation of "Accord 2.0" - a more focused, efficient and scalable Canadian small and medium-sized business lending platform centered on asset-based lending, equipment finance and working capital solutions, supported by strategic lending partnerships, including with investment-grade Crown corporations. Management believes this repositioning will result in a simpler operating structure, improved financial flexibility, and a stronger platform for the Company to serve the evolving needs of Canadian small and medium-sized enterprises.

Irene Eddy

Senior Vice President, Chief Financial Officer August 14, 2026

Note: average funds employed is average finance receivable and loans calculated for each month of the year or quarter and divided by the number of months in the period.

Note: weighted average shareholders' equity is the average shareholder's equity calculated for each month of the fiscal year and divided by the number of months in the period.

Note: weighted average shareholders' equity is the average shareholder's equity calculated for each month of the fiscal year, then totalled up and divided by the number of months in the period.

Average funds employed

387,834

Note: average funds employed is average finance receivable and loans calculated for each month of the year or quarter and divided by the number of months in the period.

Note: debt comprises the bank indebtedness, loans payable, debentures and notes payable as taken from the Consolidated Statements of Financial Position.

(Expressed in thousands of Canadian dollars, except where otherwise indicated)

(Expressed in thousands of Canadian dollars, except where otherwise indicated)

Three months Six months

Three months Six months

(Expressed in thousands of Canadian dollars, except where otherwise indicated)

Capital stock

Number of

Accumulated

Non-

common other controlling

shares

Contributed

Retained comrehensive

interests in

Note outstanding Amount

surplus

earnings

income

subsidiary Total equity

(Expressed in thousands of Canadian dollars, except where otherwise indicated)

See accompanying notes

1. Description of the business

   Accord Financial Corp. (the "Company") is incorporated by way of Articles of Continuance under the Ontario Business Corporations Act and, through its subsidiaries, is engaged in providing asset-based financing, including factoring and receivables financing, equipment and inventory financing, leasing, and working capital financing, to industrial and commercial enterprises, principally in Canada and the United States. The Company's registered office is at 40 Eglinton Avenue East, Suite 602, Toronto, Ontario, Canada.

2. Basis of presentation and statement of compliance
   1. Basis of presentation

      These condensed interim unaudited consolidated financial statements ("Statements") are expressed in thousands of Canadian dollars, except per share amounts and as otherwise noted, the Company's functional and presentation currency, and are prepared in accordance with International Accounting Standard 34, Interim Financial Reporting ("IAS 34") as issued by the International Accounting Standards Board ("IASB"). Accordingly, the condensed consolidated interim financial statements contain selected explanatory notes to the financial statements and do not include all the disclosures required by IFRS Accounting Standards ("IFRS"). These Statements and notes should be read in conjunction with the audited consolidated financial statements and notes included in the Company's Annual Report for the fiscal year ended December 31, 2025.

      The preparation of the condensed interim unaudited consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue and expenses. Actual results may differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Changes to accounting estimates are recognized in the year in which the estimates are revised and in any future periods affected. Estimates that are particularly judgmental relate to the determination of the allowance for expected credit losses ("ECL") relating to finance receivables and loans (note 5), the carrying value of assets held for sale (note 6), as well as the valuation of deferred tax assets and liabilities.

      These condensed interim unaudited consolidated financial statements for the six months ended June 30, 2026 were approved for issuance by the Company's Board of Directors ("Board") on August 14, 2026.

   2. Basis of Measurement and Going Concern

The financial statements have been prepared on a going concern basis and measured at historical cost, unless otherwise disclosed.

The application of the going concern basis presumes that the Company will continue to be in operation for the foreseeable future and be able to realize its assets and discharge its liabilities and commitments in the normal course of business. In making its assessment, when the Company is aware of material uncertainties related to events or conditions that may cast significant doubt upon the entity's ability continue as a going concern, the entity is required to disclose those uncertainties.

The Company has financial liabilities of $120.8 million that are due within the next 12 months, which are primarily comprised of: (i) an outstanding revolving credit facility provided by a syndicate of six banks with a contractual maturity date of October 31, 2026 of $55.0 million (Note 7), (ii) debentures of $28.6 million to mature on July 31, 2026 (Note 10) and (iii) unsecured term notes maturing on November 6, 2026 (Note 9). The maturity details of the loans due are outlined in Note 15. Please see subsequent events for details related to the extension of the Company's debentures and unsecured subordinated demand and term notes held by the members of the Hitzig family ("Hitzig Notes").

The Company is in compliance with all credit facility covenants of the bank indebtedness and continues to work on a refinancing plan with its creditors. In June 2026, the Company extended the maturity date of its Senior Credit Facility ("Senior Credit Facility") to October 31, 2026, and its unsecured term notes to November 6, 2026. The Company continues to seek new sources of financing for all its debt. However, there is a risk that the availability of financing options to refinance the debt that matures in 2026 may not be available on terms that provide the necessary covenant accommodations or other conditions acceptable to the Company, or may not be available on any terms at all.

With respect to near-term debt maturities, the Company continues pursuing plans to refinance its outstanding debt or settle the debt instruments through the sales of the underlying assets securing such debts. However, such activities and actions may be unsuccessful or insufficient to fully address the maturing indebtedness as a result of not being able to dispose of assets or obtain financing on terms and conditions acceptable to the Company or at all. If any or all of the Company's funding sources are not replaced or renewed on terms acceptable to the Company, the Company may not have the financing necessary to conduct its business, which could have a material adverse impact on its business. The above conditions represent a material uncertainty that cast a significant doubt on the Company's ability to continue as a going concern. Please see the subsequent events footnote for details of amendments to the maturity dates of the Company's debentures and unsecured demand and term notes.

These financial statements do not reflect adjustments to the carrying amounts of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. These adjustments may be material.