{"url_path":"/sec/refi/8-k/2026-07-13/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 Entry into a Material Definitive Agreement.**","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-07-13","source_url":"https://www.sec.gov/Archives/edgar/data/1867949/0001213900-26-077585-index.html","accession_number":"0001213900-26-077585","cik":"0001867949","ticker":"REFI","issuer_name":"Chicago Atlantic Real Estate Finance, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1867949/0001213900-26-077585-index.html","primary_entity_key":"0001867949","primary_entity_name":"Chicago Atlantic Real Estate Finance, Inc."},"word_count":592,"has_tables":true,"body_markdown":"** **\n\n****\n\n \n\n** **\n\n \n\n \n\n** **\n\n**Item\n1.01. Entry into a Material Definitive Agreement.**\n\n \n\nOn July 9, 2026, Chicago Atlantic Real Estate Finance, Inc. (the “Company”)\nentered into a Loan Agreement (the “Loan Agreement”) with Koach Capital Fund I LLC, Koach Capital Fund II LP, Koach Capital\nFund III LP and their respective wholly owned subsidiaries (collectively, “Koach”), pursuant to which the Company issued 4,306,754\nshares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), at a price of $14.53 per share,\nin a private placement transaction, in exchange for second lien promissory notes issued by Koach in an aggregate principal amount of approximately\n$62.5 million (individually, each a “Note” and collectively, the “Koach Notes”). The shares of Common Stock issued\nto Koach represent approximately 16.8% of the shares of Common Stock outstanding immediately after giving effect to the issuance.\n\n \n\nThe Koach Notes are individually\nsecured by mortgages on 32 retail and related properties leased to cannabis operators and are subordinate to senior first lien indebtedness\nin an aggregate principal amount of approximately $39 million as of the closing date.\n\n \n\nThe Koach Notes bear interest\nat an aggregate rate of 12.0% per annum, comprised of 10.0% payable in cash and 2.0% payable in kind, with cash interest payments due\nand payable monthly, and have an aggregate weighted average time to maturity of approximately 12.0 years. The Koach Notes provide for\nan exit fee of 2.5x the commitment amount of each Note. The Koach Notes contain customary events of default, including failure to pay\namounts when due, breaches of covenants, cross-defaults to the related senior first lien indebtedness, and bankruptcy and insolvency events\nwith respect to the applicable Koach entity, upon the occurrence and during the continuance of which the holder may accelerate the amounts\ndue under the applicable Note.\n\n \n\nNo underwriter or placement\nagent was engaged by the Company in connection with the transaction, and no underwriting discounts or commissions were or will be paid\nby the Company.\n\n \n\nAdditionally, all Koach investors\nare subject to the terms of a lock-up letter pursuant to which they agree not to sell, transfer, pledge, or otherwise dispose of the Common\nStock for a period of (i) three months (with respect to 20% of the Common Stock issued to such investor) and (ii) six months (with respect\nto the remaining 80% of such Common Stock), in each case following the closing date, subject to limited exceptions.\n\n \n\nThe foregoing descriptions of the Loan Agreement, the Koach Notes and\nthe lock-up letters do not purport to be complete and are qualified in their entirety by reference to the form of Loan Agreement and the\nform of Lock-Up Letter, copies of which are filed as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and are\nincorporated herein by reference.\n\n** **\n\n**Pending Merger**\n\n \n\nAs previously announced, on\nJune 17, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Chicago Atlantic BDC,\nInc. (“LIEN”) and the other parties thereto, pursuant to which, subject to the terms and conditions set forth therein, the\nCompany will merge with and into LIEN, with LIEN continuing as the surviving company (the “Merger”). The issuance of the Common\nStock and the acquisition of the Koach Notes described above are permitted under the terms of the Merger Agreement. The shares of Common\nStock issued in the transaction will increase the number of shares of Common Stock outstanding and, accordingly, will be reflected in\nthe inputs used to determine the exchange ratio for the Merger in accordance with the Merger Agreement."}