{"url_path":"/sec/tpta/8-k/2026-07-02/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 **","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-07-02","source_url":"https://www.sec.gov/Archives/edgar/data/1674356/0001104659-26-080408-index.html","accession_number":"0001104659-26-080408","cik":"0001674356","ticker":"TPTA","issuer_name":"Terra Property Trust, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1674356/0001104659-26-080408-index.html","primary_entity_key":"0001674356","primary_entity_name":"Terra Property Trust, Inc."},"word_count":2062,"has_tables":true,"body_markdown":"**Item 1.01**\n**Entry into a Material Definitive Agreement.**\n\n \n\n**Exchange\nOffer**\n\n \n\nOn June 30,\n2026, Terra Property Trust, Inc., a Maryland corporation (the “Company”), completed the previously disclosed exchange\noffer for the Company’s 6.00% Senior Notes due June 30, 2026 (the “TPTA Notes”) that expired on June 26, 2026\n(the “Exchange Offer”). Pursuant to the Exchange Offer, the Company offered to exchange all validly tendered TPTA Notes for\na combination of (i) new 11.00% Senior Secured Notes due July 1, 2027 of the Company (the “Exchange Notes”) and\n(ii) cash.\n\n \n\nThe Exchange\nOffer expired at 5:00 p.m. New York City time, on June 26, 2026, and the final settlement of the Exchange Offer took place on\nJune 30, 2026.\n\n \n\nIn connection\nwith the Exchange Offer, the Company filed a registration statement on Form S-4 (File No. 333-295631) relating to the issuance\nof the Exchange Notes with the U.S. Securities and Exchange Commission (the “SEC”) on May 7, 2026 (as amended from time\nto time, the “Registration Statement”), which was declared effective by the SEC on June 26, 2026. The Exchange Offer\nwas made pursuant to the terms and conditions set forth in the Registration Statement, which contains a more comprehensive description\nof the Exchange Offer.\n\n \n\nAlso, on\nJune 30, 2026, the Company repaid the remaining outstanding principal balance of the TPTA Notes.\n\n \n\n**Indenture**\n\n \n\nAs previously\nannounced, $36,208,750 of the TPTA Notes were validly tendered and not withdrawn in the Exchange Offer. On June 30, 2026 (the “Issue\nDate”), the Company issued Exchange Notes with an aggregate principal balance of $27,156,250. The Exchange Notes were issued pursuant\nto an Indenture (the “Indenture”), dated June 30, 2026, by and between the Company and U.S. Bank Trust Company, National\nAssociation, in its capacity as trustee and collateral agent, a copy of which is filed as Exhibit 4.1 hereto, and is incorporated\nherein by reference.\n\n \n\nThe Exchange\nNotes are the senior secured obligations of the Company to the extent of the value of the Collateral (as defined below) securing the Exchange\nNotes (subject, as to the Shared Collateral (as defined below), to the terms of the Intercreditor Agreement (as defined in the Indenture)),\npari passu in right of payment with the Existing Secured Notes (as defined in the Indenture) (subject to the terms of the Intercreditor\nAgreement) and all of the Company’s existing and future unsubordinated debt that is not expressly subordinated in right of payment\nto the Exchange Notes, senior in right of payment to any of the Company’s existing and future debt that is expressly subordinated\nin right of payment to the Exchange Notes, effectively senior to the Company’s existing and future debt that is unsecured or that\nis secured by a junior lien on the Collateral, in each case to the extent of the value of the Collateral securing the Exchange Notes (subject,\nas to the Shared Collateral, to the terms of the Intercreditor Agreement), effectively subordinated to all of the Company’s existing\nand future debt, guarantees and other liabilities (including trade payables) that are secured by liens on assets that do not constitute\na part of the Collateral securing the Exchange Notes to the extent of the value of such assets securing such debt and other liabilities\n(including with respect to the Supplemental Liquidity Financing (as defined in the Indenture)), and structurally subordinated to all existing\nand future debt and other liabilities (including trade payables) of any existing and future subsidiaries of the Company. Subject to certain\nexceptions, the Exchange Notes are secured by a perfected security interest in the Collateral.\n\n \n\nAs of the\nIssue Date, the Exchange Notes were not guaranteed by any of the Company’s subsidiaries. Subject to certain exceptions, the Exchange\nNotes are secured by perfected liens granted by the Company on certain equity interests in the Company’s subsidiaries held by the\nCompany from time to time, as more fully described in the Registration Statement. Subject to certain exceptions described in the Registration\nStatement, the Company has initially granted liens in the following (collectively with any liens on additional collateral that are granted\nby the Company from time to time, the “Collateral”): the equity interests the Company holds in (i) Terra East Dallas\nIndustrial, LLC, (ii) Howell Lendco LLC, (iii) Maspen MS I LLC, (iv) Royaltree Lendco, LLC, (v) Terra 370 Lex, LLC,\n(vi) Terra Driggs, LLC, (vii) Terra Walnut Development, LLC, (viii) Vaspen MS I LLC, (ix) XS Maple LLC, (x) Terra\nIndustrial LLC, (xi) MCM Maxx, LLC, (xii) Terra Mortgage Portfolio I, LLC, (xiii) Terra Income Fund 6, LLC, (xiv) Terra\nMortgage Portfolio II, LLC, (xv) TPT Special Subsidiary, LLC, (xvi) University Park Lendco, LLC, (xvii) the newly-created\nspecial purpose entity which would be created as part of the Supplemental Liquidity Financing, which holds, directly or indirectly, the\ncapital interests in Boundary Pref LLC, Peachtree Lendco LLC, Fund Financing, LLC, Mavik Revol One Holdings, LLC and New Walnut Member\nLLC and (xviii) Wonder Group, Inc., and any proceeds in respect of the foregoing (collectively, the “Shared Collateral”).\nEach of (i) Terra East Dallas Industrial, LLC and Dallas — 11333 Pagemill Owner, LLC, (ii) Howell Lendco LLC, (iii) Terra\nMortgage Capital I, LLC and (iv) Terra Mortgage Portfolio II, LLC has initially granted liens on all or substantially all of its\nassets (collectively, the “Specific Exchange Notes Collateral” and, collectively with the Shared Collateral and any additional\ncollateral a lien is granted on from time to time by the Company or any of its subsidiaries, the “Collateral”). However, the\nIndenture permits the Company to release the liens on any of the Shared Collateral securing the Exchange Notes (i) in whole, upon\na satisfaction and discharge of the indenture, a legal defeasance or a covenant defeasance of the Exchange Notes, (ii) in whole or\nin part, with the consent of the requisite holders in accordance with the relevant provisions of the Indenture, including consents obtained\nin connection with a tender offer or exchange offer for, or purchase of, Exchange Notes, (iii) as provided in the Intercreditor Agreement,\nsolely as to the Shared Collateral, and (iv) upon a sale or other disposition of the Specific Exchange Notes Collateral and the application\nof the Net Cash Proceeds (as defined in the Indenture) of such sale or other disposition in accordance with the terms of the Indenture.\n\n \n\n \n\n \n\n \n\nThe Company\nwill pay interest on the Exchange Notes monthly, on the last day of each month, beginning July 31, 2026. Interest on the Exchange\nNotes will accrue from June 30, 2026, at a rate of 11.00% per annum. The Exchange Notes will mature on July 1, 2027, unless\nearlier redeemed or repurchased by the Company in accordance with their terms prior to such date.\n\n \n\nThe Company\nis required to redeem the Exchange Notes in whole or in part upon the consummation of certain asset sales, upon the receipt of certain\nextraordinary receipts, upon the Company’s incurrence of certain senior secured indebtedness, with certain Excess Cash Flow (as\ndefined in the Indenture) amounts, and upon the receipt of proceeds from the repayment of certain assets that secure the Exchange Notes\nat a redemption price equal to 102% of the outstanding principal amount of the Exchange Notes to be redeemed plus accrued and unpaid interest\npayments otherwise payable thereon for the then-current monthly interest period accrued to, but excluding, the date fixed for redemption.\n\n \n\nPrior to\nJuly 1, 2027, the Company may elect to redeem the Exchange Notes in whole or in part at any time, or from time to time, at a redemption\nprice equal to 102% of the outstanding principal amount of the Exchange Notes to be redeemed plus accrued and unpaid interest payments\notherwise payable thereon for the then-current monthly interest period accrued to, but excluding, the date fixed for redemption.\n\n \n\nThe Indenture\ncontains certain covenants that, among other things, limit the Company’s ability to: (i) incur certain additional indebtedness;\n(ii) pay Dividends (as defined in the Indenture) (other than for purposes of maintaining REIT tax status), repurchase Capital Interests\n(as defined in the Indenture) or pay operating expenses in excess of an agreed upon budget; and (iii) merge or consolidate with another\nperson.\n\n \n\nThe Indenture\ndoes not require the Company to offer to purchase the Exchange Notes in connection with a change of control or any other event.\n\n \n\nThe Indenture\nprovides for certain events of default, including: (i) the Company’s failure to pay the principal (or premium, if any) of any\nExchange Note when due; (ii) the Company’s failure to pay the interest on any Exchange Note when due and such default is not\ncured within 5 days; (iii) the Company remains in breach of any other covenant with respect to the Exchange Notes for 30 days after\nreceiving a written notice of default stating the Company is in breach; (iv) the occurrence of any of the following: (a) except\nas permitted by the Indenture, any Security Document (as defined in the Indenture) or the Intercreditor Agreement ceases for any reason\nto be fully enforceable, in each case, on any material portion of the Collateral purported to be covered thereby; (b) except\nas permitted by the indenture governing the Exchange Notes, any lien purported to be granted under any Security Document on any material\nportion of the Collateral ceases to be a valid, enforceable and perfected lien with the priority required by the Security Documents;\nor (c) the Company, or any person acting on its behalf, denies or disaffirms, in any pleading in any court of competent jurisdiction,\nany material obligation of the Company’s set forth in or arising under any Security Document; (v) the Company file for bankruptcy\nor certain other events of bankruptcy, insolvency or reorganization; and (vi) in the case of certain orders or decrees entered against\nthe Company under any bankruptcy law, such order or decree remains undischarged or unstayed for a period of 60 days. The events of default\nare subject to important exceptions and qualifications, as set forth in the Indenture.\n\n \n\n \n\n \n\n \n\n**Term Loan**\n\n \n\nOn June 29, 2026,\nSubsidiary Holdings II, LLC (“Subsidiary Holdings”), a Delaware limited liability company and a wholly-owned subsidiary of\nthe Company, entered into a term loan agreement (the “Term Loan Agreement”) with Strategic Yieldco LLC, a Delaware limited\nliability company, as lender (“Strategic Yieldco”), pursuant to which Strategic Yieldco provided an initial term commitment\nin an aggregate amount of up to $25 million and Subsidiary Holdings borrowed a term loan in an aggregate amount of $25 million (the “Term\nLoan”). The proceeds of the Term Loan were distributed by Subsidiary Holdings to the Company as partial funding to repay the TPTA\nNotes and to pay the cash portion of the Exchange Offer.\n\n \n\nPursuant to the Term\nLoan Agreement, the Company has guaranteed, on an unsecured and limited recourse basis, certain obligations under such Term Loan Agreement.\nThe Term Loan bears interest at a rate equal to eleven percent (11.00%) per annum, payable in cash in arrears on the last business day\nof each calendar quarter. In addition, Subsidiary Holdings paid a non-refundable upfront fee equal to four percent (4.00%) of the amount\nof the Term Loan to Strategic Yieldco.\n\n \n\nThe Term Loan will mature\nand become payable on December 29, 2027. The Term Loan is secured by equity interests held by (i) Subsidiary Holdings I, LLC\nin Subsidiary Holdings, and (ii) Subsidiary Holdings in Fund Financing, LLC, Peachtree Lendco LLC, Boundary Pref LLC, Mavik Revol\nOne Holdings LLC, and New Walnut Member LLC. The Term Loan would also be mandatorily payable, with certain exceptions, to the extent Subsidiary\nHoldings, or any of its subsidiaries, receives net proceeds in respect of the funds and portfolio investments held by the entities identified\nin the preceding sentence from (i) any sale, disposition or transfer of any interest, direct or indirect, therein and (ii) dividends\nand other distributions.\n\n \n\nThe Term Loan Agreement\ncontains customary covenants with respect to Subsidiary Holdings, which are subject to a number of limitations and exceptions as provided\ntherein, and contains customary events of default, bankruptcy and insolvency, and remedies provisions.\n\n \n\nThe above\ndescription of the Indenture, the Exchange Notes and Term Loan Agreement contained in this Item 1.01 is a summary only and is qualified\nin its entirety by reference to the Indenture, the Form of Exchange Notes included therein, and the Term Loan Agreement, which are\nattached hereto as Exhibits 4.1, 4.2, and 10.1, respectively, and are incorporated herein by reference."}