Strategic Transition and Market Positioning

• Completed the first quarter operating as a Business Development Company (BDC), expanding investment flexibility beyond real estate-backed cannabis loans.

• Shifted focus toward the lower middle market to capture an 'exceptional vintage' created by larger lenders moving upmarket to support existing portfolios.

• Targeting cash-flowing operating businesses with $5 million to $50 million in EBITDA, a segment management believes offers superior risk-adjusted returns.

• Achieved net fundings of $39.1 million in Q1, driven by $90 million in new non-cannabis commitments offset by $41.2 million in cannabis loan repayments.

• Emphasizing strong credit quality through the use of financial covenants, such as cash flow measures and fixed charge coverage ratios, rather than the covenant-light structures common in larger deals.

• Maintaining a robust active pipeline of over $1.5 billion in potential deals across healthcare, consumer, manufacturing, and services sectors.

Outlook and Deployment Strategy

• Expects overall portfolio yields to shift toward the low double-digit range as the company prioritizes higher-quality borrowers and sponsors over higher-yielding cannabis assets.

• Intends to redeploy capital from cannabis loan paydowns and non-accrual liquidations into performing lower middle market credits to support current income.

• Anticipates that federal rescheduling of cannabis could improve asset values and recovery prospects for non-accrual loans, though the primary growth focus remains non-cannabis lending.

• Plans to utilize available dry powder and an expanded $80 million credit facility for deployment throughout 2026, though specific timing remains subject to market conditions.

• Authorized a $5 million share buyback program as a flexible tool for capital allocation and enhancing long-term shareholder value.

Portfolio Credit and Risk Factors

• Reported three loans currently on non-accrual status, with a focus on maximizing recovery through liquidations and legal remedies.

• Expressed the intention to exercise rights and remedies against Justice Grown following a maturity default on 05/01/2026., targeting collateral including cultivation facilities and dispensaries in New Jersey and Pennsylvania.

• Received a $6.2 million paydown from the Debbie Holdings receivership during Q1, bringing total recoveries from that credit to $20.8 million.

• Expanded the senior secured revolving credit facility to $80 million, with a potential accordion feature to reach $100 million.