SCHEDULE: Tricor Boosts CPI Card Group Stake to 19.1%, Secures Board Seats

Tricor Pacific Capital Inc. and its subsidiary Tricor PMT25 Holdings Inc. have increased their beneficial ownership in CPI Card Group Inc. to 19.1% and secured rights to nominate up to two directors.

Summary

• Tricor Pacific Capital Inc. and its subsidiary, Tricor PMT25 Holdings Inc., now beneficially own 2,176,056 shares of CPI Card Group Inc., representing 19.1% of the outstanding common stock.
• This ownership includes 1,926,056 "Restricted Shares" purchased in December 2025 for $26.0 million ($13.51 per share) from two investment funds.
• It also includes 250,000 "Prior Shares" purchased in September 2024 for $5.3 million ($21.00 per share) in an underwritten secondary public offering.
• In connection with the December 2025 acquisition, Tricor PMT25 Holdings Inc. secured pro rata board nomination rights, currently allowing it to nominate up to two directors to CPI Card Group Inc.'s board and gain representation on board committees.
• Tricor PMT25 Holdings Inc. also became a party to the existing Registration Rights Agreement with CPI Card Group Inc.
• A Lock-Up Agreement was signed on December 4, 2025, restricting the sale or transfer of the 1,926,056 Restricted Shares for a period of one year from that date.

Sentiment

Score: 7

Explanation: The acquisition of a significant stake by Tricor Pacific Capital Inc. and the securing of board nomination rights suggest a strategic, long-term investment. This can be viewed positively for CPI Card Group Inc. as it brings a committed, influential shareholder. The lock-up agreement provides stability for a large block of shares. The lower purchase price for the recent acquisition compared to a prior one could be a slight negative, but the overall strategic move is positive.

Positives

• Significant strategic investment by Tricor Pacific Capital Inc., increasing its stake to 19.1% of CPI Card Group Inc.
• Tricor PMT25 Holdings Inc. gained rights to nominate up to two directors to the board, indicating increased influence and oversight.
• Secured representation on CPI Card Group Inc.'s board committees.
• The investment demonstrates confidence in CPI Card Group Inc.'s future by a substantial shareholder.

Negatives

• The 1,926,056 Restricted Shares are subject to a one-year lock-up period, preventing their sale or transfer until December 4, 2026.
• The December 2025 share purchase price of $13.51 per share is lower than the September 2024 purchase price of $21.00 per share, potentially indicating a decrease in market value or a discounted private transaction.

Future Outlook

The Reporting Persons have no present plan or proposal for significant changes to CPI Card Group Inc. but reserve discretion to take other actions with respect to their investment based on factors such as the Issuer's financial position, investment strategy, share price levels, market conditions, and general economic and industry conditions.

Management Comments

• The undersigned authorizes the Company and its transfer agent and registrar to decline to make any transfer of shares of Common Stock if such transfer would constitute a violation or breach of this Lock-Up Agreement.
• The Reporting Persons have no present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) (j) of Item 4 of Schedule 13D except as set forth herein.

Industry Context

This filing indicates a significant strategic investment by a family office in a payment card technology company. The acquisition of a substantial stake and board representation suggests a long-term commitment and potential for active shareholder engagement, which is common in mature industries where strategic investors seek to influence corporate direction and unlock value.

Corporate Governance

Stakeholder Impact

• Shareholders: Increased stability due to a large, locked-up block of shares. Potential for enhanced corporate governance with a significant investor gaining board representation.
• Management: Will need to collaborate with new board representatives from Tricor, potentially influencing strategic direction.

Next Steps

• Tricor PMT25 Holdings Inc. will adhere to the one-year lock-up period for the 1,926,056 Restricted Shares, expiring December 4, 2026.
• Tricor PMT25 Holdings Inc. is entitled to nominate up to two directors to CPI Card Group Inc.'s board and seek representation on board committees.
• The Reporting Persons reserve the right to take further actions regarding their investment based on market conditions and CPI Card Group Inc.'s performance.

Key Dates

Recommendation

The filing indicates a significant strategic investment by Tricor Pacific Capital Inc., increasing its stake to 19.1% and securing board representation. This suggests a long-term commitment and potential for enhanced corporate governance, which is generally positive. However, the recent acquisition price of $13.51 per share is notably lower than a prior purchase at $21.00, which could reflect a decline in the company's valuation or a discounted private transaction. The one-year lock-up on a substantial portion of the shares provides near-term stability but also limits liquidity for that block. Given the mixed signals of a strong strategic commitment alongside a lower recent purchase price, a 'hold' recommendation is appropriate, advising investors to monitor the company's performance and the impact of Tricor's increased involvement.

Keywords

CPI Card Group Inc., Tricor Pacific Capital, Schedule 13D, Share acquisition, Beneficial ownership, Board nomination rights, Lock-up agreement, Financial investment, Corporate governance, SEC filing