Financial Data and Key Metrics Changes - Gross investment income for Q2 2025 was $13.1 million, up from $11.9 million in Q1 2025, indicating a positive trend in income generation [14] - Net investment income remained consistent at $7.7 million or $0.34 per share, maintaining the same dividend rate for four consecutive quarters [7][14] - Net assets at the end of the quarter were $302 million, with a net asset value per share of $13.23 [14] Business Line Data and Key Metrics Changes - The company funded $39.1 million in new debt investments during Q2, with 100% being senior secured and 88% floating rate [15] - The portfolio consists of 33 companies, with 22% invested in non-cannabis sectors [11][12] - The average debt investment position size is 3% of the investment portfolio, and 76% of the portfolio has floating interest rates [12] Market Data and Key Metrics Changes - The current pipeline includes approximately $780 million in potential debt transactions, with $649 million in cannabis opportunities and $131 million in non-cannabis investments [16][19] - The company has approximately $125.4 million in liquidity, providing ample capacity for future investments [13] Company Strategy and Development Direction - The company focuses on lending to cannabis companies and underserved markets, positioning itself uniquely in the BDC sector [5][10] - The strategy includes underwriting investments based on current cash flow and collateral profiles, rather than relying on potential regulatory changes [9][10] - The company aims to grow returns to shareholders as it scales its platform and navigates market conditions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the cannabis market, noting that potential rescheduling could lead to increased cash flow for borrowers and higher valuations [8][9] - There is a belief that the current environment will continue to provide opportunities for growth, despite regulatory uncertainties [9][19] - The company remains focused on originating loans that deliver attractive risk-adjusted returns [20] Other Important Information - The company has no non-accrual loans, contrasting with the industry average of 3.8% [7] - The weighted average yield on debt investments is 16.1%, significantly higher than the average BDC yield of 11.8% [6] Q&A Session Summary Question: Overview on market sentiment about the BDC sector - Management noted that the BDC sector has been impacted by uncertainty around tariffs but is insulated from broader market dynamics due to its niche strategy [22][23] Question: Changes under the Trump administration regarding BDC regulation - Management indicated that it is too early to speculate on potential regulatory changes under the new administration [24] Question: Changes in pipeline and opportunities since becoming Chicago Atlantic BDC - The company has gained access to a broader pipeline of non-cannabis opportunities and identified new types of cannabis opportunities, including restructurings and ESOP transactions [25][26][27] Question: Impact of rescheduling news on potential clients - Management observed that operators are more optimistic and seeking capital earlier to execute growth strategies, rather than pausing for potential regulatory changes [28][29]

Company Overview - Chicago Atlantic BDC has closed over $2.8 billion in loans since its platform inception[11] - The company has a near-term pipeline under evaluation of approximately $780 million[11] - The total portfolio investment value is $308 million[11] - The gross weighted-average yield of the company's debt investments is 16.1%[11] - 100% of the company's current debt investments are senior secured[11] Financial Performance - Gross investment income for the quarter ended June 30, 2025, was $13.1 million[35] - Net investment income for the same quarter was $7.7 million[35] - Net asset value at the end of the period was $301.8 million[35] - Net investment income per share was $0.34[35] - Net asset value at the end of the period per share was $13.23[35] Portfolio Composition - Cannabis investments represent 78% of the total fair value of the company's investment portfolio[40] - Non-cannabis investments account for 22% of the portfolio[40] - Floating rate debt accounts for 76.3% of debt investments fair value[38] - 45.8% of floating rate debt is at their respective floor[38]

[PART I: FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section provides the unaudited financial statements, management's discussion, market risk disclosures, and controls and procedures for Chicago Atlantic BDC, Inc [Item 1. Financial Statements (unaudited)](index=5&type=section&id=Item%201%20Financial%20Statements%20(unaudited)) This section presents the unaudited financial statements for Chicago Atlantic BDC, Inc. as of June 30, 2025, including statements of assets, operations, cash flows, and investments [Statements of Assets and Liabilities](index=5&type=section&id=Statements%20of%20Assets%20and%20Liabilities) Assets grew to $331.8 million, liabilities to $29.9 million, driven by investments and new borrowings, with NAV per share at $13.23 Key Balance Sheet Data (in thousands) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Investments at fair value | $307,499 | $275,241 | | Cash and cash equivalents | $13,829 | $23,932 | | **Total Assets** | **$331,750** | **$309,561** | | **Liabilities** | | | | Revolving line of credit | $5,000 | $0 | | Payable for investments purchased | $11,760 | $0 | | **Total Liabilities** | **$29,907** | **$8,398** | | **Total Net Assets** | **$301,844** | **$301,163** | | **NAV Per Share** | **$13.23** | **$13.20** | [Statements of Operations](index=6&type=section&id=Statements%20of%20Operations) Investment income surged to $25.0 million, driving net investment income to $15.3 million and a $16.2 million net increase in net assets Statements of Operations Highlights (Six Months Ended June 30, in USD) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total Investment Income | $25,003,040 | $5,841,580 | | Net Expenses | $9,690,012 | $4,395,756 | | Net Investment Income | $15,313,028 | $1,445,824 | | Net Increase in Net Assets from Operations | $16,198,622 | $1,812,672 | | Net Investment Income Per Share | $0.67 | $0.23 | | Net Increase in Net Assets Per Share | $0.71 | $0.29 | [Statements of Changes in Net Assets](index=7&type=section&id=Statements%20of%20Changes%20in%20Net%20Assets) Net assets increased by $0.7 million to $301.8 million, driven by operations and offset by stockholder distributions - Net assets increased from **$301.16 million** at the end of 2024 to **$301.84 million** at June 30, 2025[20](index=20&type=chunk) - The increase was primarily due to a **$16.2 million** net increase from operations, offset by **$15.5 million** in distributions to stockholders[20](index=20&type=chunk) [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows) Net cash used in operating activities was $5.3 million, and financing activities used $4.8 million, reducing cash to $13.8 million Cash Flow Summary (Six Months Ended June 30, 2025, in USD) | Activity | Net Cash Flow | | :--- | :--- | | Operating Activities | ($5,314,609) | | Financing Activities | ($4,788,443) | | **Net Decrease in Cash** | **($10,103,052)** | | Cash at Beginning of Period | $23,932,406 | | **Cash at End of Period** | **$13,829,354** | [Schedule of Investments](index=10&type=section&id=Schedule%20of%20Investments) Investments at fair value reached $307.5 million, primarily debt, with the U.S. Cannabis sector as the largest concentration Total Investments (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Amortized Cost | $305,719 | $274,347 | | Fair Value | $307,499 | $275,241 | - The portfolio consists predominantly of U.S. Corporate Debt, with First Lien Senior Secured loans and Senior Secured Notes making up the vast majority of holdings[24](index=24&type=chunk)[26](index=26&type=chunk) - The U.S. Debt Cannabis sector is the largest single concentration, with a fair value of **$229.7 million**[24](index=24&type=chunk) [Notes to Financial Statements](index=18&type=section&id=Notes%20to%20Financial%20Statements) Notes detail the company's BDC structure, RIC election, Level 3 investment valuation, portfolio, credit facility, related party transactions, and dividends - The company is an externally managed BDC that has elected to be treated as a RIC for tax purposes. Its investment objective is to maximize risk-adjusted returns, with a focus on the cannabis industry[39](index=39&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) - All investments are valued at fair value using significant unobservable inputs and are categorized as Level 3 assets. The valuation process is performed by the Adviser as the designated Valuation Designee[54](index=54&type=chunk)[59](index=59&type=chunk)[65](index=65&type=chunk) - In February 2025, the company entered into a **$100 million** senior secured revolving credit facility, of which **$5 million** was outstanding as of June 30, 2025[117](index=117&type=chunk)[122](index=122&type=chunk) - The company declared and paid quarterly dividends of **$0.34 per share** for the first two quarters of 2025[151](index=151&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=51&type=section&id=Item%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, operational results, investment portfolio growth to $307.5 million, asset quality, liquidity, and critical accounting estimates - The company is a specialty finance BDC focused on direct loans to privately held companies, primarily in the cannabis industry, but also in growth & technology, esoteric & asset-based lending, and liquidity solutions[175](index=175&type=chunk)[180](index=180&type=chunk) - As of June 30, 2025, the investment portfolio's fair value was **$307.5 million**, up from **$275.2 million** at year-end 2024, with **78.5%** concentrated in the cannabis industry[200](index=200&type=chunk)[207](index=207&type=chunk) - All investments were rated '**Grade 2**' as of June 30, 2025, indicating performance in line with expectations and an acceptable level of risk. No investments were on non-accrual status[212](index=212&type=chunk)[213](index=213&type=chunk) - Net investment income for the six months ended June 30, 2025, was **$15.3 million**, a significant increase from **$1.4 million** in the prior-year period, primarily due to the growth of the investment portfolio following the Loan Portfolio Acquisition[222](index=222&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=77&type=section&id=Item%203%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces valuation, credit, and interest rate risks, with 76.2% of its debt portfolio in floating-rate investments, impacting net income - The company's primary market risks are valuation risk, interest rate risk, and credit risk[267](index=267&type=chunk) - Valuation risk exists due to the inherent uncertainty of determining fair value for investments without readily available market quotes (Level 3 assets)[268](index=268&type=chunk) Portfolio Interest Rate Composition (by Principal Balance) | Rate Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Floating-rate | 76.2% | 79.5% | | Fixed-rate | 23.8% | 20.5% | Annualized Impact of Interest Rate Changes on Net Income (in thousands) | Change in Interest Rates | Increase (Decrease) in Net Income | | :--- | :--- | | Up 200 basis points | $4,146 | | Up 100 basis points | $1,848 | | Down 100 basis points | ($1,088) | [Item 4. Controls and Procedures](index=77&type=section&id=Item%204%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The company's disclosure controls and procedures were deemed effective as of June 30, 2025[272](index=272&type=chunk) - No material changes were made to the internal control over financial reporting during the three months ended June 30, 2025[273](index=273&type=chunk) [PART II: OTHER INFORMATION](index=79&type=section&id=PART%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits for Chicago Atlantic BDC, Inc [Item 1. Legal Proceedings](index=79&type=section&id=Item%201%20Legal%20Proceedings) The company is not subject to any material legal proceedings, nor is it aware of any being threatened - As of the filing date, the company is not a party to any material legal proceedings[274](index=274&type=chunk) [Item 1A. Risk Factors](index=79&type=section&id=Item%201A%20Risk%20Factors) No material changes to risk factors, except for new risks associated with the senior secured revolving credit facility and potential asset foreclosure - No material changes to risk factors from the 2024 Form 10-K, except for new risks associated with the recently established credit facility[275](index=275&type=chunk) - The new credit facility subjects a significant portion of the company's assets to security interests, and a default could result in foreclosure and forced sale of these assets[276](index=276&type=chunk)[278](index=278&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=79&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On April 11, 2025, 22 common shares were issued at $10.71 per share under the DRIP, exempt from registration - On April 11, 2025, **22 shares** of common stock were issued at **$10.71 per share** under the company's DRIP[280](index=280&type=chunk) [Item 3. Defaults Upon Senior Securities](index=79&type=section&id=Item%203%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults on its senior securities during the period - None[281](index=281&type=chunk) [Item 4. Mine Safety Disclosures](index=79&type=section&id=Item%204%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not Applicable[283](index=283&type=chunk) [Item 5. Other Information](index=81&type=section&id=Item%205%20Other%20Information) No officers or directors adopted or terminated Rule 10b5-1 trading plans during the second quarter of 2025 - No officers or directors adopted or terminated Rule 10b5-1 trading plans during the three months ended June 30, 2025[284](index=284&type=chunk) [Item 6. Exhibits](index=82&type=section&id=Item%206%20Exhibits) This section lists exhibits filed, including CEO and CFO certifications and various incorporated agreements - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906[285](index=285&type=chunk) - The Credit Agreement, among other documents, is incorporated by reference from previous filings[285](index=285&type=chunk)[287](index=287&type=chunk)

Exhibit 99.1 Chicago Atlantic BDC, Inc. Reports Second Quarter 2025 Financial Results NEW YORK, August 14, 2025 --- Chicago Atlantic BDC, Inc. ("LIEN" or the "Company") (NASDAQ: LIEN), a specialty finance company that has elected to be regulated as a business development company, today announced its financial results for the second quarter ended June 30, 2025. Second Quarter 2025 Highlights and Subsequent Activity Peter Sack, Chief Executive Officer of the Company, commented, "Through a consistent and measu ...

Group 1 - The Company, Chicago Atlantic BDC, Inc., is a specialty finance company regulated as a business development company, focusing on maximizing risk-adjusted returns on equity by investing primarily in direct loans to privately held middle-market companies, particularly in the cannabis sector [4] - The financial results for the second quarter ended June 30, 2025, will be released before the market opens on August 14, 2025, followed by a conference call at 9:00 a.m. Eastern Time [2][6] - The conference call will be accessible to the general public via a live audio webcast on the Company's website [2][3]

Financial Data and Key Metrics Changes - Gross investment income for Q1 2025 was $11.9 million, down from $12.7 million in Q4 2024 [12] - Net investment income was $7.6 million or $0.34 per share, compared to $8 million or $0.35 per share in the previous quarter [13] - Net assets at the end of the quarter were $301 million, with NAV per share at $13.19 [13] Business Line Data and Key Metrics Changes - The company has 31 portfolio companies, with 21% of the portfolio invested outside of cannabis [14] - The average debt position size is 3% of the debt portfolio, with 76% of the portfolio being floating rate [14] - The gross weighted average yield on company debt investments is approximately 16.6% [14] Market Data and Key Metrics Changes - The company originated $52.8 million in gross fundings since October 1, 2024, with $32.3 million committed and $20.8 million funded in Q1 2025 [8][16] - The pipeline includes approximately $590 million in potential debt transactions across 35 unique companies, with $462 million in cannabis opportunities and $128 million in non-cannabis investments [18] Company Strategy and Development Direction - The company focuses on lending to cannabis companies and other underserved markets, aiming to deploy capital with differentiated risk-reward profiles [6][11] - The strategy includes maintaining a disciplined underwriting approach and being selective with borrowers to build durable investment portfolios [20] - The company plans to grow its dividend component as it scales its platform, with a current dividend of $0.34 per share [10] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the potential for federal regulatory changes, although the timing is unpredictable [10] - The company believes it is well-positioned for 2025, focusing on proven operators and strong markets [11] - Management emphasizes a long-term view of partnership building with operators, regardless of broader market conditions [24][26] Other Important Information - The company has no non-accruals compared to an industry average of 3.9% [8] - The company closed on a new $100 million credit facility during the quarter, providing ample liquidity for new investments [15] Q&A Session Summary Question: General macro outlook and deployment of $100 million in loans - Management views the U.S. cannabis industry as a collection of individual state markets, allowing for a more focused investment strategy [24][26] Question: Pipeline activity in cannabis vs. non-cannabis sectors - No significant difference in deployment ratios is expected; fluctuations are considered ordinary [28] Question: Flexibility to increase the credit facility - Management believes there is room to grow the senior secured credit facility and add modest unsecured notes in a disciplined manner [29] Question: Debt leverage threshold - The company expects to maintain leverage well below industry averages for the foreseeable future [30] Question: Dividend growth expectations - Management does not provide specific dividend guidance but emphasizes that nearly all income will be distributed by year-end [32]

Financial Data and Key Metrics Changes - Gross investment income for Q1 2025 was $11.9 million, a decrease from $12.7 million in Q4 2024 [11] - Net investment income was $7.6 million or $0.34 per share, compared to $8.0 million or $0.35 per share in the previous quarter [12] - Net expenses were $4.3 million, slightly down from $4.4 million in the last quarter [12] - Net assets at quarter end were $301 million, with NAV per share at $13.19 [12] Business Line Data and Key Metrics Changes - The company has 31 portfolio companies, with 21% of the portfolio invested outside of cannabis [12] - The average debt position size is 3% of the debt portfolio, with 76% of the portfolio being floating rate [13] - The gross weighted average yield on company debt investments is approximately 16.6% [13] Market Data and Key Metrics Changes - The company has originated $52.8 million in gross fundings since October 1, 2024, with $32.3 million committed and $20.8 million funded in Q1 2025 [7] - The pipeline includes approximately $590 million in potential debt transactions across 35 unique companies, with $462 million in cannabis opportunities and $128 million in non-cannabis investments [16] Company Strategy and Development Direction - The company focuses on lending to cannabis companies and other underserved markets, aiming to deploy capital with differentiated risk-reward profiles [5] - The strategy includes maintaining a disciplined underwriting approach and being selective with borrowers to build durable investment portfolios [19] - The company aims to grow its dividend component as it scales its platform, having declared a total of $1.27 in dividends over the last four quarters [8] Management's Comments on Operating Environment and Future Outlook - Management believes the outlook for common sense reforms in the cannabis industry is positive, but the timing remains unpredictable [10] - The company is positioned well for 2025, focusing on proven operators and strong markets to support growth initiatives [10] - Management emphasizes a long-term view of partnership building with operators, regardless of broader market conditions [23] Other Important Information - The company has no non-accruals compared to an industry average of 3.9% [7] - A new $100 million credit facility was closed during the quarter, providing ample liquidity for future investments [14] Q&A Session Summary Question: General macro outlook and deployment readiness - The company maintains a focus on individual state markets rather than the broader U.S. cannabis industry, allowing for disciplined deployment of capital [23][25] Question: Pipeline activity comparison to previous quarters - There is no significant difference in the ratio of cannabis to non-cannabis investments, with fluctuations being ordinary [26] Question: Flexibility to increase the credit facility - The company sees room to grow its senior secured credit facility and add modest unsecured notes in a disciplined manner [27] Question: Debt leverage threshold - The company expects to remain well below industry averages for debt leverage in the foreseeable future [28] Question: Dividend growth expectations - The company does not provide specific dividend guidance but will distribute nearly all of its income by the end of the year [30]

Chicago Atlantic BDC, Inc. (LIEN) came out with a quarterly loss of $0.34 per share versus the Zacks Consensus Estimate of $0.34. This compares to loss of $0.01 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -200%. A quarter ago, it was expected that this company would post earnings of $0.29 per share when it actually produced earnings of $0.35, delivering a surprise of 20.69%.Over the last four quarters, the company has surp ...

Financial Reporting - Chicago Atlantic BDC, Inc. will report its financial results for Q1 2025 on May 14, 2025, before market open[5] - The earnings conference call and live audio webcast will take place at 9:00 a.m. Eastern Time on May 14, 2025[5] - The press release regarding the financial results is included as Exhibit 99.1 to the Current Report[5]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-40564 CHICAGO ATLANTIC BDC, INC. (Exact name of registrant as specified in its charter) | Maryland 86-2872887 | | | | --- | --- | --- | | (State or other jurisdi ...