REFI swaps $62.5M of second-lien notes for 4.3M shares at $14.53, diluting existing holders by 16.8%

summarizeSummary

REFI issued 4.3M shares at $14.53/share in a private placement to acquire $62.5M of second-lien notes, resulting in 16.8% dilution. The notes yield 12% and are secured by cannabis retail properties. The transaction is permitted under the pending merger with LIEN and will impact the merger exchange ratio.

check_boxKey Events · Financing and Capital Events · REFI

• Share Issuance for Notes

  REFI issued 4,306,754 common shares at $14.53 per share—a 35% premium to the current $10.73 price—in exchange for $62.5 million of second-lien promissory notes secured by 32 cannabis retail properties.

• Dilution Impact

  The newly issued shares represent approximately 16.8% of shares outstanding post-issuance, diluting existing shareholders. The shares are subject to a lock-up: 20% released after 3 months, 80% after 6 months.

• Note Terms

  The notes bear interest at 12.0% per annum (10.0% cash, 2.0% PIK), have a weighted average maturity of ~12 years, and include an exit fee of 2.5x the commitment amount. They are subordinate to $39 million in senior first-lien debt.

• Merger Context

  The transaction is permitted under the pending all-stock merger agreement with Chicago Atlantic BDC (LIEN). The new shares will increase the share count used to calculate the merger exchange ratio, potentially altering the relative ownership split.

auto_awesomeAnalysis · REFI · Real Estate & Construction

In a transaction that reshapes its capital structure, REFI issued 4.3 million shares at $14.53 apiece—a premium to the current $10.73 price—to acquire $62.5 million of second-lien notes backed by 32 cannabis retail properties. The move dilutes existing shareholders by roughly 16.8% while adding a 12%-yielding asset to the portfolio. A staggered lock-up (20% at three months, 80% at six months) tempers immediate selling pressure. This financing unfolds against the backdrop of a pending all-stock merger with Chicago Atlantic BDC (LIEN); the newly issued shares will increase the share count used to determine the merger exchange ratio, potentially shifting the relative ownership of the combined entity.