Chicago Atlantic Real Estate Finance, Inc.

Previous wording

our future operating results and projected operating results;

Current wording

our future and projected operating results;

Previous wording

the allocation of loan opportunities to us by our Manager;

Current wording

the allocation of loan opportunities to us by our Manager and its affiliates;

Previous wording

changes in interest rates and impacts of such changes on our results of operations, cash flows, and the market value of our loans;

Current wording

changes in interest rates and impacts of such changes on our results of operations, cash flows, and the value of our loans;

Previous wording

We are a commercial mortgage real estate investment trust. Our primary investment objective is to provide attractive, risk-adjusted returns for stockholders over time primarily through consistent current income dividends and other distributions and secondarily through capital appreciation. We intend to achieve this objective by originating, structuring and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Our current portfolio is comprised primarily of senior loans to state-licensed operators in the cannabis industry, secured by real estate, equipment, receivables, licenses or other assets of the borrowers to the extent permitted by applicable laws and regulations governing such borrowers. We also invest in companies or properties that are not related to the cannabis industry that provide return characteristics consistent with our investment objective. We intend to grow the size of our portfolio by continuing the track record of our business and the business conducted by our Manager and its affiliates by making loans to leading operators and property owners in the cannabis industry. There is no assurance that we will achieve our investment objective.

Current wording

We were formed in March 2021 as a Maryland corporation and are structured as an externally managed mortgage real estate investment trust (“REIT”). We completed our initial public offering ("IPO") in December 2021 and have elected to be taxed as a REIT for United States federal income tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2021. Our primary investment objective is to provide attractive, risk-adjusted returns for stockholders over time primarily through consistent current income dividends and other distributions and secondarily through capital appreciation. We intend to achieve this objective by originating, structuring and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Our current portfolio is comprised primarily of senior loans to state-licensed operators in the cannabis industry, secured by real estate, equipment, receivables, licenses or other assets of the borrowers to the extent permitted by applicable laws and regulations governing such borrowers. We aim to maintain a diversified portfolio across jurisdictions and verticals, including cultivators, processors, dispensaries, and other businesses ancillary thereto.

Previous wording

Our loans are secured by real estate and, in addition, when lending to owner-operators in the cannabis industry, other collateral, such as equipment, receivables, licenses or other assets of the borrowers to the extent permitted by applicable laws and regulations. In addition, we seek to impose strict loan covenants and seek personal or corporate guarantees for additional protection. As of September 30, 2025 and December 31, 2024, 34.8% and 50.0%, respectively, of the principal of loans held in our portfolio are backed by personal or corporate guarantees. We aim to maintain a portfolio diversified across jurisdictions and across verticals, including cultivators, processors, dispensaries, as well as ancillary businesses. In addition, we may invest in borrowers that have equity securities that are publicly traded on the Canadian Stock Exchange (“CSE”) in Canada and/or over-the-counter in the United States.

Current wording

Our loans are generally secured by real estate and, when lending to owner-operators in the cannabis industry, other collateral, such as equipment, receivables, intellectual property, licenses or other assets of the borrowers to the extent permitted by applicable laws and regulations governing such borrowers. We also seek personal or corporate guarantees for additional credit protection on our loans.

Previous wording

Interest on our loans is generally payable monthly. The principal amount of our loans and any accrued but unpaid interest thereon generally become due at the applicable maturity date. In some cases, our interest income includes a paid-in-kind (“PIK”) component for a portion of the total interest. The PIK interest, computed at the contractual rate specified in each applicable loan agreement, is accrued in accordance with the terms of such loan agreement and capitalized to the principal balance of the loan and recorded as interest income. The PIK interest added to the principal balance is typically amortized and paid in accordance with the applicable loan agreement. In cases where the loans do not amortize, the PIK interest is collected upon repayment of the outstanding principal. We also generate revenue from original issue discounts (“OID”), which is also recognized as interest income from loans over the initial term of the applicable loans. Delayed draw loans may earn interest or unused fees on the undrawn portion of the loan, which is recognized as interest income in the period earned. Other fees, including prepayment fees and exit fees, are also recognized as interest income when received. Any such fees will be generated in connection with our loans and recognized as earned in accordance with generally accepted accounting principles (“GAAP”).

Current wording

We generate revenue primarily in the form of interest income on loans which is generally payable monthly. The principal amount of our loans and any accrued but unpaid interest thereon generally become due at the applicable maturity date. In some cases, our interest income includes a paid-in-kind (“PIK”) component for a portion of the total interest. The PIK interest, computed at the contractual rate specified in each applicable loan agreement, is accrued in accordance with the terms of such loan agreement and capitalized to the principal balance of the loan and recorded as interest income. The PIK interest added to the principal balance is typically amortized and paid in accordance with the applicable loan agreement. In cases where the loans do not amortize, the PIK interest is collected upon repayment of the outstanding principal. We also generate revenue from original issue discounts (“OID”), which is also recognized as interest income from loans over the initial term of the applicable loans. Delayed draw loans may earn interest or unused fees on the undrawn portion of the loan, which is recognized as interest income in the period earned. Other fees, including prepayment fees and exit fees, are also recognized as interest income when received. Any such fees will be generated in connection with our loans and recognized as earned in accordance with generally accepted accounting principles (“GAAP”).

Previous wording

Our primary operating expense is the payment of Base Management Fees and Incentive Compensation under our Management Agreement with our Manager and the allocable portion of overhead and other expenses paid or incurred on our behalf, including reimbursing our Manager for a certain portion of the compensation of certain personnel of our Manager who assist in the management of our affairs, excepting only those expenses that are specifically the responsibility of our Manager pursuant to our Management Agreement. We bear all other costs and expenses of our operations and transactions, including (without limitation) fees and expenses relating to:

Current wording

Our primary operating expenses are the payment of Base Management Fees and Incentive Compensation under our Management Agreement with our Manager and the allocable portion of overhead and other expenses paid or incurred on our behalf, including reimbursing our Manager for a certain portion of the compensation of certain personnel of our Manager who assist in the management of our affairs, excepting only those expenses that are specifically the responsibility of our Manager pursuant to our Management Agreement. We bear all other costs and expenses of our operations and transactions, including (without limitation) fees and expenses relating to:

Previous wording

accounting and audit fees and expenses from our independent registered public accounting firm;

Current wording

audit and tax compliance fees and expenses from our independent registered public accounting firm;

Previous wording

To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute annually to our stockholders at least 90% of our REIT taxable income prior to the deduction for dividends paid. To the extent that we distribute less than 100% of our REIT taxable income in any tax year (taking into account any distributions made in a subsequent tax year under Sections 857(b)(9) or 858 of the Code), we will pay tax at regular corporate rates on that undistributed portion. Furthermore, if we distribute less than the sum of 1) 85% of our ordinary income for the calendar year, 2) 95% of our capital gain net income for the calendar year, and 3) any undistributed shortfall from our prior calendar year (the “Required Distribution”) to our stockholders during any calendar year (including any distributions declared by the last day of the calendar year but paid in the subsequent year), then we are required to pay a non-deductible excise tax equal to 4% of any shortfall between the Required Distribution and the amount that was actually distributed. The 90% distribution requirement does not require the distribution of net capital gains. However, if we elect to retain any of our net capital gain for any tax year, we must notify our stockholders and pay tax at regular corporate rates on the retained net capital gain. Our stockholders must include their proportionate share of the retained net capital gain in their taxable income for the tax year, and they are deemed to have paid the REIT’s tax on their proportionate share of the retained capital gain. Furthermore, such retained capital gain may be subject to the nondeductible 4% excise tax. If it is determined that our estimated current year taxable income will be in excess of estimated dividend distributions (including capital gain dividend) for the current year from such income, we will accrue excise tax on estimated excess taxable income as such taxable income is earned. The annual expense is calculated in accordance with applicable tax regulations. Excise tax expense, if any, is included in the line item, income tax expense. For the nine months ended September 30, 2025, we did not incur excise tax expense.

Current wording

To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute annually to our stockholders at least 90% of our REIT taxable income prior to the deduction for dividends paid. To the extent that we distribute less than 100% of our REIT taxable income in any tax year (taking into account any distributions made in a subsequent tax year under Sections 857(b)(9) or 858 of the Code), we will pay tax at regular corporate rates on that undistributed portion. Furthermore, if we distribute less than the sum of 1) 85% of our ordinary income for the calendar year, 2) 95% of our capital gain net income for the calendar year, and 3) any undistributed shortfall from our prior calendar year (the “Required Distribution”) to our stockholders during any calendar year (including any distributions declared by the last day of the calendar year but paid in the subsequent year), then we are required to pay a non-deductible excise tax equal to 4% of any shortfall between the Required Distribution and the amount that was actually distributed. The 90% distribution requirement does not require the distribution of net capital gains. However, if we elect to retain any of our net capital gain for any tax year, we must notify our stockholders and pay tax at regular corporate rates on the retained net capital gain. Our stockholders must include their proportionate share of the retained net capital gain in their taxable income for the tax year, and they are deemed to have paid the REIT’s tax on their proportionate share of the retained capital gain. Furthermore, such retained capital gain may be subject to the nondeductible 4% excise tax. If it is determined that our estimated current year taxable income will be in excess of estimated dividend distributions (including capital gain dividend) for the current year from such income, we will accrue excise tax on estimated excess taxable income as such taxable income is earned. The annual expense is calculated in accordance with applicable tax regulations. Excise tax expense, if any, is included in the line item, income tax expense. For the three months ended March 31, 2026, we did not incur excise tax expense.

Previous wording

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 740 - Income Taxes (“ASC 740”), prescribes a recognition threshold and measurement attribute for the consolidated financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have analyzed our various federal and state filing positions and believe that our income tax filing positions and deductions are documented and supported as of September 30, 2025. Based on our evaluation, there is no reserve for any uncertain income tax positions. Accrued interest and penalties, if any, are included within other liabilities in the consolidated balance sheets.

Current wording

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 740 - Income Taxes (“ASC 740”), prescribes a recognition threshold and measurement attribute for the consolidated financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have analyzed our various federal and state filing positions and believe that our income tax filing positions and deductions are documented and supported as of March 31, 2026 and 2025. Based on our evaluation, there is no reserve for any uncertain income tax positions. Accrued interest and penalties, if any, are included within other liabilities in the consolidated balance sheets.

Previous wording

As of September 30, 2025 and December 31, 2024, our portfolio of loans held for investment had a weighted-average YTM IRR of 16.5% and 17.2%, and was substantially secured by real estate and, with respect to certain of our loans, substantially all assets of the borrowers and certain of their subsidiaries, including equipment, receivables, and licenses. YTM IRR is calculated using various inputs, including (i) cash and PIK interest, which is capitalized and added to the outstanding principal balance of the applicable loan, (ii) original issue discount (“OID”), (iii) amortization, (iv) unused fees, and (v) exit fees. Certain of our loans have extension fees, which are not included in our YTM IRR calculations, but may increase YTM IRR if such extension options are exercised by borrowers.

Current wording

As of March 31, 2026 and December 31, 2025, our loan portfolio had a weighted-average yield-to-maturity internal rate of return (“YTM IRR”) of 15.8% and 16.3%, respectively, and was substantially secured by real estate and, with respect to certain of our loans, substantially all assets of the borrowers and certain of their subsidiaries, including equipment, receivables, and licenses. YTM IRR is calculated using various inputs, including (i) cash and paid-in-kind (“PIK”) interest, which is capitalized and added to the outstanding principal balance of the applicable loan, (ii) original issue discount (“OID”), (iii) amortization, (iv) unused fees, and (v) exit fees. Certain of our loans have extension or amendment fees, which are not included in our YTM IRR calculations, but may increase YTM IRR if such extension options are exercised by borrowers.

Previous wording

The below table summarizes our portfolio of loans held for investment by rate type as of September 30, 2025 and December 31, 2024:

Current wording

Our loans bear interest rates that are either fixed or determined periodically on the basis of Prime or SOFR plus a premium. Loans which bear interest on either Prime or SOFR are collectively referred to as "Floating-rate loans". The below table summarizes our portfolio of loans held for investment by rate type as of March 31, 2026 and December 31, 2025:

Previous wording

The following tables present changes in loans held for investment at carrying value as of and for the nine months ended September 30, 2025 and 2024:

Current wording

The following tables present changes in loans held for investment at carrying value as of and for the three months ended March 31, 2026 and 2025:

Previous wording

We assess the risk factors of each loan, and assign a risk rating based on a variety of factors, including, without limitation, payment history, real estate collateral coverage, property type, geographic and local market dynamics, financial performance, enterprise value of the portfolio company, loan structure and exit strategy, and project sponsorship. This review is performed quarterly. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

Current wording

Our Manager uses an ongoing investment risk rating system to characterize and monitor our outstanding loans. The Manager's investment committee, with input from the portfolio management team, assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, payment history, real estate collateral coverage, property type, geographic and local market dynamics, financial performance, enterprise value of the portfolio company, loan structure and exit strategy, and project sponsorship. This review is performed quarterly. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

Previous wording

The risk ratings are primarily based on historical data and current conditions specific to each portfolio company, as well as consideration of future economic conditions and each borrower’s estimated ability to meet debt service requirements. The risk ratings shown in the following table as of September 30, 2025 and December 31, 2024 consider borrower specific credit history and performance and quarterly re-evaluation of overall current macroeconomic conditions affecting the borrowers. As interest rates have increased due to rising rates from the Federal Reserve Board, it has impacted borrowers’ ability to service their debt obligations on a global scale. Changes in risk ratings had an effect on the level of the CECL reserve though, other than the two loans placed on non-accrual status, the loans continued to perform as expected. For approximately 54% of the portfolio, the fair value of the underlying real estate collateral exceeded the amounts outstanding under the loans as of September 30, 2025. The remaining approximately 46% of the portfolio, while not fully collateralized by real estate, may be partially collateralized by real estate and was secured by other forms of collateral including equipment, receivables, licenses and/or other assets of the borrowers to the extent permitted by applicable laws and regulations governing such borrowers.

Current wording

The risk ratings are primarily determined based on current and historical performance metrics specific to each portfolio company, as well as consideration of future economic conditions and each borrower’s estimated ability to meet debt service requirements. The risk ratings shown in the following table as of March 31, 2026 and December 31, 2025 consider borrower specific credit history and performance and reflect a quarterly re-evaluation of overall current macroeconomic conditions affecting the Company’s borrowers, specifically those designated as held for investment. The below table presents the categorization of our loan portfolio on the above rating scale, at carrying value as of March 31, 2026 and December 31, 2025:

Previous wording

Updates to Our Loan Portfolio during the Third Quarter of 2025

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Updates to Our Loan Portfolio during the First Quarter of 2026

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Subsequent Updates to Our Loan Portfolio

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Subsequent Updates to Our Loan Portfolio during the Second Quarter of 2026

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During the three months ended September 30, 2025, we declared an ordinary cash dividend of $0.47 per share of our common stock, relating to the third quarter of 2025, which was paid on October 15, 2025 to stockholders of record as of the close of business on September 30, 2025. The total amount of the cash dividend payment was approximately $9.9 million.

Current wording

During the three months ended March 31, 2026, we declared an ordinary cash dividend of $0.47 per share of our common stock, relating to the first quarter of 2026, which was paid on April 15, 2026 to stockholders of record as of the close of business on March 31, 2026. The total amount of the cash dividend payment was approximately $9.9 million.

Previous wording

We believe that favorable market conditions, including an imbalance in supply and demand of credit to cannabis operating companies, have provided attractive opportunities for non-bank lenders, such as us, to finance commercial real estate loans and other loans that exhibit strong fundamentals but also require more customized financing structures and loan products than regulated financial institutions can presently provide. Additionally, to the extent that additional states legalize cannabis, our addressable market will increase. We intend to continue to capitalize on these opportunities and growing the size of our portfolio.

Current wording

We believe that favorable market conditions, including an imbalance in supply and demand of credit to cannabis operating companies, have provided attractive opportunities for non-bank lenders, such as us, to finance commercial real estate loans and other loans that exhibit strong fundamentals but also require more customized financing structures and loan products than regulated financial institutions can presently provide. Additionally, to the extent that additional states legalize cannabis, our addressable market will increase. While we intend to continue capitalizing on these opportunities and growing the size of our portfolio, we are aware that the competition for the capital we provide is increasing.

Previous wording

Interest income increased by approximately $0.2 million, during the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The increase was primarily due to an increase in the outstanding principal balance of the loan portfolio which increased to approximately $399.9 million as of September 30, 2025 from approximately $356.3 million as of September 30, 2024. The increase was offset by the decrease of weighted-average yield-to-maturity internal rate of return (“YTM IRR”) on our portfolio to 16.5% at September 30, 2025 from 18.2% at September 30, 2024, as a result of certain re-pricing amendments relating to de-risking of our portfolio and the impact of the 75 basis point prime rate decline on our floating rate portfolio.

Current wording

Interest income increased by approximately $0.1 million during the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025. The increase was driven primarily by an increase of $0.8 million in exit/success fees associated with the full repayments of three loans during the period. Interest income from acceleration of original issue discounts and other upfront fees generated approximately $0.7 million and $0.4 million of gross interest income during the three months ended March 31, 2026 and 2025, respectively. Additionally, the weighted average YTM IRR on our portfolio decreased from 16.9% at March 31, 2025 to 15.8% at March 31, 2026, as a result of certain re-pricing amendments relating to de-risking of our portfolio and the impact of the 75 basis point prime rate decline on our floating rate portfolio during the comparative periods.

Previous wording

Interest expense decreased by approximately $0.2 million, or 13%, over the comparative period. The decrease was due to the 25 basis point prime rate decline and a decrease in the weighted average outstanding balance on the Revolving Loan, which was approximately $14.0 million and $76.4 million, as of September 30, 2025, and 2024, respectively.

Current wording

Interest expense remained consistent over the comparative period. This decrease is driven primarily by a decrease in unused fees and the amortization of debt issuance costs in the amount of $43 thousand, which was partially offset by an increase in the weighted average outstanding balance on the Revolving Loan, which was approximately $48.0 million and $41.6 million, as of March 31, 2026 and 2025, respectively.

Previous wording

Stock based compensation expense increased by approximately $83 thousand for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The increase over the comparable period was driven by the incremental expense recognized on the 187,157 restricted stock awards granted to employees of our Manager on April 1, 2025, which have a vesting period of three years.

Current wording

Stock based compensation expense increased slightly by approximately $0.2 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase over the comparative period is driven by the incremental expense recognized on the 187,157 of restricted stock awards granted during 2025, which had not been granted as of March 31, 2025.

Previous wording

Distributable Earnings is a measure that is not prepared in accordance with GAAP. We define Distributable Earnings as, for a specified period, the net income (loss) computed in accordance with GAAP, excluding (i) non-cash equity compensation expense, (ii) depreciation and amortization, (iii) any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period; provided that Distributable Earnings does not exclude, in the case of investments with a deferred interest feature (such as OID, debt instruments with PIK interest and zero coupon securities), accrued income that we have not yet received in cash, (iv) provision for current expected credit losses and (v) one-time events pursuant to changes in GAAP and certain non-cash charges, in each case after discussions between our Manager and our independent directors and after approval by a majority of such independent directors. We define Adjusted Distributable Earnings, for a specified period, as Distributable Earnings excluding certain non-recurring organizational expenses (such as one-time expenses related to our formation and start-up).

Current wording

In addition to using certain financial metrics prepared in accordance with GAAP to evaluate our performance, we also use Distributable Earnings and Adjusted Distributable Earnings to evaluate our performance. Each of Distributable Earnings and Adjusted Distributable Earnings is a measure that is not prepared in accordance with GAAP. We define Distributable Earnings as, for a specified period, the net income (loss) computed in accordance with GAAP, excluding (i) non-cash equity compensation expense, (ii) depreciation and amortization, (iii) any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period; provided that Distributable Earnings does not exclude, in the case of investments with a deferred interest feature (such as OID, debt instruments with PIK interest and zero coupon securities), accrued income that we have not yet received in cash, (iv) provision for current expected credit losses and (v) one-time events pursuant to changes in GAAP and certain non-cash charges, in each case after discussions between our Manager and our independent directors and after approval by a majority of such independent directors. We define Adjusted Distributable Earnings, for a specified period, as Distributable Earnings excluding certain non-recurring organizational expenses (such as one-time expenses related to our formation and start-up).

Previous wording

The book value per share of our common stock as of September 30, 2025 and December 31, 2024 was approximately $14.71 and $14.83, respectively.

Current wording

The book value per share of our common stock as of March 31, 2026 and December 31, 2025 was approximately $14.39 and $14.60, respectively.

Previous wording

Our primary sources of cash generally consist of unused borrowing capacity under our financing sources, the net proceeds of future offerings of equity or debt securities, payments of principal and interest we receive on our portfolio of assets and cash generated from our operating results. On a long-term basis, we expect that our primary sources of financing will be, to the extent available to us, through (a) credit facilities and (b) public and private offerings of our equity and debt securities. We may utilize other sources of financing to the extent available to us. As the cannabis industry continues to evolve and to the extent that additional states legalize cannabis, we expect the demand for capital will continue to increase as operators seek to enter and build out new markets. In the short-term, we expect the principal amount of the loans we originate will increase and that we will need to raise additional equity and/or debt financing to increase our liquidity. We expect to achieve this through recycling capital from loan paydowns, repayments, and sales of common stock related to our shelf registration statement.

Current wording

Our primary sources of cash generally consist of unused borrowing capacity under our financing sources, the net proceeds of future offerings of equity or debt securities, payments of principal and interest we receive on our portfolio of assets and cash generated from our operating results. On a long-term basis, we expect that our primary sources of financing will be, to the extent available to us, through (a) credit facilities and (b) public and private offerings of our equity and debt securities. We may utilize other sources of financing to the extent available to us. As the cannabis industry continues to evolve and to the extent that additional states legalize cannabis, the demand for capital continues to increase as operators seek to enter and build out new markets. In the short-term, we expect the principal amount of the loans we originate to increase and that we will need to raise additional equity and/or debt financing to increase our liquidity. We expect to achieve this through recycling capital from loan paydowns, repayments, and sales of common stock related to our shelf registration statement.

Previous wording

As of September 30, 2025 and December 31, 2024, all of our cash was unrestricted and totaled approximately $28.9 million and $26.4 million, respectively. We believe that our cash on hand, capacity available under our Revolving Loan, the Unsecured Notes and cash flows from operations for the next twelve months will be sufficient to satisfy the operating requirements of our business through at least the next twelve months. The sources of financing for our target investments are described below.

Current wording

As of March 31, 2026 and December 31, 2025, all of our cash was unrestricted and totaled approximately $27.9 million and $14.9 million, respectively. We believe that our cash on hand, capacity available under our Revolving Loan, and cash flows from operations for the next twelve months will be sufficient to satisfy the operating requirements of our business through at least the next twelve months. The sources of financing for our target investments are described below.

Previous wording

We may seek to raise further equity capital and issue debt securities in order to fund our future investments in loans. Our Shelf Registration Statement became effective on January 19, 2023, allowing us to sell, from time to time in one or more offerings, up to $500 million of our securities, including common stock, preferred stock, debt securities, warrants and rights (including as part of a unit) to purchase shares of our common stock, preferred stock, or debt securities. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering. We may also access liquidity through our ATM Program, which was established in June 2023 and amended in March 2025, pursuant to which we may sell, from time to time, up to $100.0 million of our common stock.

Current wording

We may seek to raise further equity capital and issue debt securities in order to fund our future investments in loans. Our Shelf Registration Statement on Form S-3 became effective on January 19, 2023 (the "Previous Registration Statement"), allowing us to sell, from time to time in one or more offerings, up to $500 million of our securities, including common stock, preferred stock, debt securities, warrants and rights (including as part of a unit) to purchase shares of our common stock, preferred stock, or debt securities. We filed a replacement Shelf Registration Statement on Form S-3 on January 16, 2026 (the “New Registration Statement), which extends the effectiveness period of the Previous Registration Statement 180 days or until the effectiveness of the New Registration Statement, whichever comes first. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering. We may also access liquidity through our ATM Program, which was established in June 2023 and amended in March 2025, pursuant to which we may sell, from time to time, up to $100.0 million of our common stock.

Previous wording

For the nine months ended September 30, 2025, the Company sold an aggregate of 64,557 shares of the Company’s common stock under the Sales Agreement at a weighted average price of $16.01 per share, generating net proceeds of approximately $1.0 million.

Current wording

During the quarter ended March 31, 2025, the Company sold an aggregate of 64,557 shares of the Company’s common stock under the Sales Agreement at a weighted average price of $16.01 per share, generating net proceeds of approximately $1.0 million.

Previous wording

As of September 30, 2025 and December 31, 2024, unamortized debt issuance costs related to the Revolving Loan, including all amendments and amendments and restatements thereto, as applicable, of $271,282 and $305,075, respectively, are recorded in other receivables and assets, net on the consolidated balance sheets.

Current wording

As of March 31, 2026 and December 31, 2025, unamortized debt issuance costs related to the Revolving Loan, including all amendments and amendments and restatements thereto, as applicable, of $221,958 and $246,620, respectively, are recorded in other receivables and assets, net on the consolidated balance sheets.

Previous wording

For the nine months ended September 30, 2025, the Company had net paydowns of $2.6 million against the Revolving Loan. As of September 30, 2025, the Company had $57.6 million available and $52.4 million outstanding under the Revolving Loan (Note 7).

Current wording

As of and for the three months ended March 31, 2026, the Company had net repayments of $18.0 million against the Revolving Loan. As of March 31, 2026, the Company had $43.0 million available and $67.1 million outstanding under the Revolving Loan (Note 6 of Part 1, Item 1 -Financial Information).

Previous wording

The following table sets forth changes in cash and cash equivalents for the nine months ended September 30, 2025 and 2024, respectively:

Current wording

The following table sets forth changes in cash and cash equivalents for the three months ended March 31, 2026 and 2025, respectively:

Previous wording

For the nine months ended September 30, 2025 and 2024, we reported “Net cash provided by operating activities” of approximately $22.3 million and $21.3 million, respectively. Net cash provided by operating activities increased approximately $0.9 million, primarily attributable to a decrease in PIK interest income of $3.3 million, an increase in related party receivables of $4.7 million, and an increase in stock based compensation expense of $0.2 million, an decrease in net income over the comparable period of approximately $1.3 million, a decrease in the interest reserve for applied interest payments of approximately $2.8 million, a decrease in accounts payable and accrued expenses of approximately $1.4 million and a decrease in interest receivable of approximately $3.6 million, over the comparable period.

Current wording

For the three months ended March 31, 2026 and 2025, we reported “Net cash provided by operating activities” of approximately $3.2 million and $7.6 million, respectively. Net cash provided by operating activities decreased approximately $4.5 million, primarily attributable to an increase in other receivables and assets of $1.8 million, a decrease in interest payable of approximately $1.3 million, a decrease in related party net payable of approximately $1.3 million related to timely collections of interest income, an increase in interest receivable of $0.8 million consisting of certain 'past due' amounts, a decrease in management and incentive fees payable of approximately $0.3 million and a decrease in net income over the comparable period of approximately $5.2 million. These changes were offset by a provision for current expected credit losses of $3.8 million during the first quarter of 2026 compared to a benefit of $1.1 million during the first quarter of 2025. Further, there was a decrease in the interest reserve for applied interest payments of approximately $0.8 million, an increase in stock based compensation of approximately $0.2 million, a $0.2 million unrealized loss on investments, and a decrease over the comparable period.

Previous wording

For the nine months ended September 30, 2025 and 2024, we reported “Net cash provided by investing activities” of approximately $16.0 million and $2.0 million, respectively.

Current wording

For the three months ended March 31, 2026 and 2025, we reported “Net cash provided by investing activities” of approximately $1.7 million and $5.5 million, respectively.

Previous wording

For the nine months ended September 30, 2024, cash outflows primarily related to $75.2 million used for the origination and funding of loans held for investment, offset by cash inflows $64.2 million of cash received from the principal repayment of loans held for investment and $13.0 million of cash received from proceeds from sales of loans.

Current wording

For the three months ended March 31, 2026 cash outflows primarily related to $49.8 million used for the origination and funding of loans held for investment, partially offset by $51.6 million of cash received from the principal repayment of loans held for investment.

Previous wording

For the nine months ended September 30, 2025, cash outflows primarily related to $59.0 million used for the origination and funding of loans held for investment, offset by cash inflows $69.5 million of cash received from the principal repayment of loans held for investment and $5.5 million of cash received from the principal repayment of loans held a fair value.

Current wording

For the three months ended March 31, 2025, cash outflows primarily related to $3.7 million used for the origination and funding of loans held for investment, partially offset by $9.2 million of cash received from the principal repayment of loans held for investment.

Previous wording

Net Cash Used in Financing Activities

Current wording

Net Cash Provided by/(used in) Financing Activities

Previous wording

For the nine months ended September 30, 2025 and 2024, we reported “Net cash used in financing activities” of approximately $(35.8) million and $(24.4) million, respectively.

Current wording

For the three months ended March 31, 2026 and 2025, we reported “Net cash provided by/(used in) financing activities” of approximately $8.0 million and ($29.7) million, respectively.

Previous wording

For the nine months ended September 30, 2024, cash inflows of approximately $20.8 million related to proceeds received from sales of our common stock through the ATM offering and $73.5 million related to draw downs on our Revolving Loan, which were offset by $85.5 million in repayments on our Revolving Loan, approximately $32.4 million in dividends paid, approximately $113 thousand in debt issuance costs paid, and approximately $757 thousand in offering costs associated with the registered at-the-market offering.

Current wording

For the three months ended March 31, 2026, cash inflows of approximately $17.9 million in net draws on our Revolving Loan, $9.9 million in dividends paid and approximately $30 thousand in debt issuance costs.

Previous wording

For the nine months ended September 30, 2025, cash inflows of approximately $1.0 million related to proceeds received from sales of our common stock through the ATM offering and $106.1 million related to draw downs on our Revolving Loan, which were offset by $108.7 million in repayments on our Revolving Loan, approximately $33.9 million in dividends paid, approximately $151thousand in offering costs associated with the registered at-the-market offering and $132 thousand in payment of debt issuance costs.

Current wording

For the three months ended March 31, 2025, cash inflows of approximately $1.0 million related to proceeds received from sales of our common stock through the registered at-the-market offering, which were offset by approximately $17.0 million in net repayments on our Revolving Loan, $13.6 million in dividends paid and approximately $82 thousand in offering costs associated with the registered at-the-market offering.

Previous wording

The following table summarizes the Company’s dividends declared during the nine months ended September 30, 2025 and 2024, respectively.

Current wording

The following table summarizes the Company’s dividends declared during the three months ended March 31, 2026 and 2025, respectively.