AFCG — what changed in the latest 10-Q

Text added vs the prior filing · source: 10-Q · 2026-08-13

• This Quarterly Report on Form 10-Q (this “Quarterly Report”), filed by Advanced Flower Capital Inc. (the “Company,” “AFC”, “we,” “us,” and “our”), and the information incorporated by reference herein, or made in other reports, filings with the SEC, and press releases contain “forward-looking stateme…

• These forward-looking statements reflect management’s current views about future events, and are subject to risks, uncertainties and assumptions. Our actual results may differ materially from the future results and events expressed or implied by the forward-looking statements. Key factors that could…

• •our ability to maintain our status under Subchapter M of the Internal Revenue Code of 1986, as amended, as a regulated investment company (“RIC”) and our qualification for tax treatment as a RIC;

• •the ability of our Adviser (as defined below) to locate suitable loan opportunities for us and to monitor and actively manage our portfolio and implement our expanded investment strategy;

• •our ability to obtain our target mix of loan and collateral types with our expected ranges of yields;

Text removed vs the prior filing · source: 10-Q · 2026-05-07

• Effective January 1, 2026, we are an externally managed, non-diversified management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as

• amended (the “1940 Act”). Advanced Flower Capital Inc. is an institutional lender that was founded in July 2020 by a veteran team of investment professionals. We are a Maryland corporation and externally managed by AFC Management, LLC (in its capacity as investment adviser, the “Adviser”) pursuant t…

• Change in unrealized losses on loans at fair value, net(685,478)

• Net increase (decrease) in net assets resulting from operations can vary from period to period due to various factors, including, but not limited to, including acquisitions, the level of new investment commitments, expenses, the recognition of realized gains and losses and changes in unrealized appr…

• Investment income. Investment income increased approximately $1.4 million, or 16%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Interest income decreased $(0.6) million period

Text added vs the prior filing · source: 10-Q · 2026-08-13

• to the specific facts and circumstances of each portfolio investment while employing a consistently applied valuation process for the types of investments we make. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we may realize amounts that are different from …

• As of June 30, 2026, the floating benchmark rates included one-month and three-month SOFR and U.S. prime. One-month SOFR was quoted at 3.7% and subject to a weighted average floor of 3.7% based on outstanding principal. Three-month SOFR was quoted at 3.7% and subject to a weighted average floor of 2…

Text removed vs the prior filing · source: 10-Q · 2026-05-07

• As of March 31, 2026, the weighted average floor of the investments in our portfolio based on outstanding principal was 3.8%.

Text added vs the prior filing · source: 10-Q · 2026-08-13

• We have been involved in a series of lawsuits against the Justice Cannabis Company and its related individuals and entities since April 2025 regarding various alleged defaults under the credit agreement entered into between the parties on April 5, 2021 and subsequently amended multiple times. The cr…

• On April 20, 2026, we sent the borrowers a Maturity Statement and on May 7, 2026 we sent the borrowers a Notice of Default for failure to pay upon maturity. As of the date of this Quarterly Report, approximately $78.8 million of principal remains outstanding under the credit facility. We are pursuin…

• In April 2025, we and AFC Agent (collectively, the “AFC Parties”) commenced legal actions against two shareholders (the “Guarantors”) of the parent of Justice Cannabis Company in the United States District Court for the Southern District of New York, which was amended in June 2025, and then again in…

• Also in April 2025, AFC Agent commenced an action against the parent of Justice Cannabis Company (the “Parent”) in New York state court asserting a claim for breach of contract arising from Parent’s failure to satisfy its obligations under a payment guaranty agreement related to the Company’s credit…

• In April 2025, two Justice Cannabis Company-affiliated cannabis companies that are borrowers under the Company’s credit facility with Justice Cannabis Company filed a complaint in the United States District Court for the District of New Jersey alleging, among other things, breach of contract, breach…

Text removed vs the prior filing · source: 10-Q · 2026-05-07

• In February 2025, AFC Agent, on behalf of the Company and the other lenders, initiated a mortgage foreclosure proceeding in connection with the forbearance agreement entered into by the Company and affiliates of the Justice Cannabis Company in March 2024 (the “2024 Justice Cannabis Company Forbearan…

• In April 2025, we and AFC Agent (collectively, the “AFC Parties”) commenced legal actions against two shareholders (the “Guarantors”) of the parent of Justice Cannabis Company in the United States District Court for the Southern District of New York asserting claims for violations of the Racketeer I…

• In June 2025, the AFC Parties filed an amended complaint against the Guarantors, asserting claims for breach of contract, tortious interference with contract, fraud, aiding and abetting fraud, and conversion, and dismissing without prejudice the RICO cause of action. In July 2025, the Parent moved t…

• On March 17, 2026, the New York state court denied Parent’s motion to dismiss the action. On April 3, 2026, AFC Agent and Parent each moved for a stay of the action. The Court has now temporarily stayed the New York state action until the Court can resolve certain issues raised by the parties’ stay …

• On March 31, 2026, the Southern District of New York denied the Guarantors’ motion to transfer and denied their motion to dismiss the cause of action for fraud, and dismissed the remaining causes of action. That action is in discovery.