# Sachem Capital Corp.: Form 10-Q for the period ended Mar 31, 2025

- Company: [Sachem Capital Corp.](/companies/sach.md) (CIK 1682220)
- Form: 10-Q
- Filed: 2025-05-01
- Accepted by EDGAR: May 1, 2025, 06:01 ET
- Period: 2025-03-31
- Accession: 0001410578-25-001059
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1682220/000141057825001059/sach-20250331x10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1682220/000141057825001059/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $11.4m | us-gaap:Revenues |
| Operating income | 3 months, 2025-01-01 to 2025-03-31 | $1.0m | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2025-01-01 to 2025-03-31 | $0 | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | $904.0k | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | $0.00 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | $0.00 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 46,784,744 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2025-01-01 to 2025-03-31 | $191.0k | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Dividends paid | 3 months, 2025-01-01 to 2025-03-31 | $2.4m | us-gaap:PaymentsOfDividendsCommonStock |
| Cash and equivalents | at 2025-03-31 | $24.4m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Total assets | at 2025-03-31 | $491.4m | us-gaap:Assets |
| Total liabilities | at 2025-03-31 | $312.1m | us-gaap:Liabilities |
| Long-term debt | at 2025-03-31 | $230.2m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2025-03-31 | $179.3m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 24,250 characters.

*The following discussion of the Company’s financial condition and results of operations should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and the notes to those statements included elsewhere in this Report. Certain statements in this discussion and elsewhere in this Report constitute forward-looking statements, within the meaning of section 21E of the Exchange Act, that involve risks and uncertainties. Actual operating results and financial conditions may differ materially from those anticipated in these forward-looking statements.*

### Company Overview

Sachem Capital Corp., a New York corporation, established in 2010 and completing an initial public offering in 2017 is a self-managed REIT that specializes in originating, underwriting, funding, servicing and managing a portfolio of first mortgage loans. We operate our business as one segment. We offer short-term (*i.e*., one to three years), secured, non-bank loans to real estate owners and investors to fund their acquisition, renovation, development, rehabilitation or improvement of properties located primarily in the northeastern and southeastern sections of the United States. The properties securing our loans are generally classified as residential or commercial real estate and, typically, are held for resale or investment. Each loan is secured by a first mortgage lien on real estate and may also be secured with additional collateral, such as other real estate owned by the borrower or its principals, a pledge of the ownership interests in the borrower by the principals thereof, and/or personal guarantees by the principals of the borrower. Our primary underwriting criteria is a conservative loan to value ratio. In addition, we may make opportunistic real estate purchases and investments apart from our lending activities.

### Critical Accounting Policies and Use of Estimates

Preparing our unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We base the use of estimates on (a) various assumptions that consider prior reporting results, (b) our projections regarding future operations, and (c) general financial market and local and general economic conditions. Actual amounts could differ from those estimates. Significant estimates include the provisions for current expected credit losses, loans held for sale at fair value, and real estate owned. See Note 2 – Significant Accounting Policies for further details.

#### Revenue Recognition

Interest income from commercial loans is recognized, as earned, over the loan period, whereas origination and modification fee revenue on commercial loans are amortized over the term of the respective notes.

#### CECL Allowance

We record an allowance for credit losses (“CECL”) in accordance with the CECL standard on our loan portfolio, including unfunded construction commitments, on a collective basis by assets with similar risk characteristics. This methodology replaces the probable incurred loss impairment methodology. In addition, interest and fees receivable and amounts included in due from borrowers, other than reimbursements, which include origination, modification and other fees receivable are also analyzed for credit losses in accordance with the CECL standard, as they represent a financial asset that is subject to credit risk. Further, CECL requires credit losses to be presented as an allowance rather than as a write-down on available-for-sale debt securities if management does not intend to sell and does not believe that it is more likely than not, they will be required to sell. As allowed under the CECL standard that we have adopted, as a practical expedient, the fair value of the collateral at the reporting date is compared to the net carrying amount of the loan when determining the allowance for credit losses for loans in pending/pre-foreclosure status, as defined. Fair value of collateral is reduced by estimated cost to sell if the collateral is expected to be sold. The CECL standard requires an entity to consider historical loss experience, current conditions, and a reasonable and supportable forecast of the economic environment. We utilize a loss-rate method for estimating current expected credit losses. The loss rate method involves applying a loss rate to a pool of loans with similar risk characteristics to estimate the expected credit losses on that pool of loans. In determining the CECL allowance, we consider various factors including (1) historical loss experience in its portfolio, (2) loan specific losses for loans deemed collateral dependent based on excess amortized cost over the fair value of the underlying collateral, and (3) its current and future view of the macroeconomic environment. We also utilize a reasonable and supportable forecast period equal to the contractual term of the loan plus any applicable short-term extensions that are reasonably expected for construction loans. Loans, interest receivable, due from borrowers, unfunded commitments, and (available-for-sale debt) investment securities are all presented net on the Condensed Consolidated Balance Sheets with expanded disclosures in the notes to the condensed consolidated financial statements. The change in the balances during the reporting period are recorded in the Condensed Consolidated Statements of Operations under the provision for credit losses.

### Our Loan Portfolio

The following table highlights certain information regarding our real estate lending activities for the three months ended March 31, 2025 (in thousands, except number of loans and weighted averages):

*(in thousands, except number*

| ​ ​ ​ ​ | ​ ​ ​ | ​ ​ ​ March 31, 2025 ​ ​ of loans and weighted averages) ​ |
| --- | --- | ---: |
| Loans disbursed | ​ | $41,308 ​ |
| Loans repaid | ​ | $47,742 ​ |
| Principal of loans transferred to real estate owned | ​ | $410 ​ |
| Number of loans transferred to real estate owned | ​ | 1 ​ |
| Number of loans held for investment outstanding | ​ | 143 ​ |
| Gross principal amount of loans held for investment | ​ | $367,860 ​ |
| Weighted average contractual interest rate(1) | ​ | 12.88% |
| Weighted average term to maturity (in months) (2) | ​ | 4 ​ |

(1) Includes default interest.

(2) Does not give effect to extensions.

At March 31, 2025, our outstanding mortgage loan portfolio included loans ranging in size from $35,000 to $42.8 million. The table below gives a breakdown of our loans held for investment by loan size as of March 31, 2025:

*(in thousands)*

| ​ ​ ​ ​ ​ Amount ​ ​ | ​ ​ ​ Number of ​ Loans ​ ​ ​ | ​ ​ ​ ​ Percentage ​ ​ ​ | ​ ​ Aggregate Gross Principal Amount | ​ ​ ​ ​ ​ ​ Percentage ​ ​ ​ |
| --- | ---: | ---: | ---: | ---: |
| $1,000,000 or less | 68 | 47.6% | $27,410 | 7.5% |
| $1,000,001 to $5,000,000 | 58 | 40.6% | 132,637 | 36.1% |
| $5,000,001 to $10,000,000 | 7 | 4.8% | 44,260 | 12.0% |
| $10,000,001 or more | 10 | 7.0% | 163,553 | 44.4% |
| Total | 143 | 100.0% | $367,860 | 100.0% |

As of March 31, 2025, the primary markets in which we were exposed were Connecticut, Florida, Massachusetts and New York. The table below gives a breakdown of our loans held for investment by state as of March 31, 2025:

*(in thousands)*

| ​ ​ ​ State ​ ​ | ​ ​ Number of Loans ​ ​ ​ | ​ ​ ​ Percentage ​ ​ ​ | ​ ​ Gross Amount Outstanding | ​ ​ ​ ​ Percentage ​ ​ ​ |
| --- | ---: | ---: | ---: | ---: |
| California | 1 | 0.7% | $4,101 | 1.1% |
| Connecticut | 73 | 51.0% | 119,013 | 32.4% |
| Florida | 19 | 13.3% | 108,742 | 29.6% |
| Georgia | 1 | 0.7% | 3,840 | 1.0% |
| Maine | 1 | 0.7% | 1,625 | 0.4% |
| Maryland | 1 | 0.7% | 864 | 0.2% |
| Massachusetts | 10 | 7.0% | 53,200 | 14.5% |
| New Jersey | 1 | 0.7% | 2,342 | 0.6% |
| New York | 21 | 14.7% | 32,840 | 8.9% |
| North Carolina | 4 | 2.8% | 7,877 | 2.1% |
| Pennsylvania | 2 | 1.4% | 4,856 | 1.3% |
| Rhode Island | 3 | 2.1% | 1,921 | 0.5% |
| South Carolina | 4 | 2.8% | 12,755 | 3.5% |
| Tennessee | 1 | 0.7% | 12,658 | 3.5% |
| Washington D.C. | 1 | 0.7% | 1,226 | 0.4% |
| Total | 143 | 100.0% | $367,860 | 100.0% |

The following table details our loans held for investment as of March 31, 2025 by year of origination:

*(in thousands)*

| ​ ​ ​ ​ ​ Year of Origination ​ ​ | ​ ​ ​ Number of ​ Loans ​ ​ ​ | ​ ​ ​ ​ Percentage ​ ​ ​ | ​ ​ Aggregate Gross Principal Amount | ​ ​ ​ ​ ​ ​ Percentage ​ ​ ​ |
| --- | ---: | ---: | ---: | ---: |
| 2025 | 7 | 4.9% | $26,366 | 7.1% |
| 2024 | 31 | 21.7% | 44,402 | 12.1% |
| 2023 | 27 | 18.9% | 78,180 | 21.3% |
| 2022 | 28 | 19.6% | 72,152 | 19.6% |
| 2021 | 31 | 21.7% | 131,790 | 35.8% |
| 2020 | 5 | 3.5% | 7,628 | 2.1% |
| 2019 and prior | 14 | 9.7% | 7,342 | 2.0% |
| Total | 143 | 100.0% | $367,860 | 100.0% |

The following tables set forth information regarding the types of properties securing loans held for investment as of March 31, 2025 and December 31, 2024:

*(in thousands)*

| ​ ​ ​ ​ ​ | ​ ​ ​ ​ | ​ ​ March 31, 2025 Aggregate Gross Principal Amount | ​ ​ ​ ​ ​ ​ ​ Percentage | ​ ​ December 31, 2024 Aggregate Gross Principal Amount | ​ ​ ​ ​ ​ Percentage |
| --- | --- | ---: | ---: | ---: | ---: |
| Residential | ​ | $192,463 | 52.4% | $211,939 | 56.2% |
| Commercial | ​ | 102,376 | 27.8% | 95,509 | 25.3% |
| Pre-Development Land | ​ | 18,939 | 5.1% | 23,466 | 6.2% |
| Mixed Use | ​ | 54,082 | 14.7% | 46,077 | 12.3% |
| Total | ​ | $367,860 | 100.0% | $376,991 | 100.0% |

#### Allowance for Credit Losses

Our allowance for credit losses is influenced by historical loss experience, current exposure by geographical region, current expected credit losses on loans in foreclosure based on fair value less cost to sell, non-performing status, and other supportable forecasts of economic conditions. A loan is considered non-performing once it has been delinquent on its monthly payments past 90 days.

The following table presents the allowance for credit losses against unpaid principal balance of loans held for investment as of March 31, 2025 and December 31, 2024:

*(in thousands)*

| ​ ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ ​ | ​ ​ March 31, 2025 ​ ​ Aggregate Gross Principal Amount | ​ ​ ​ | ​ ​ ​ ​ ​ ​ Allowance | ​ ​ ​ | ​ ​ ​ Percentage of ​ Respective ​ Principal | ​ ​ December 31, 2024 ​ ​ Aggregate Gross Principal Amount | ​ ​ ​ | ​ ​ ​ ​ ​ ​ Allowance | ​ ​ ​ | ​ ​ ​ ​ Percentage of ​ Respective ​ Principal ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | ---: | --- | ---: | --- | ---: |
| Performing – General reserve | ​ | $260,269 | ​ | $(4,841) | ​ | 1.9% | $289,910 | ​ | $(5,051) |  | 1.8% |
| Non-performing – General reserve | ​ | ​ 21,763 | ​ | ​ (221) | ​ | 1.0% | ​ 5,396 | ​ | ​ (96) | ​ | 1.8% |
| Non-performing – Direct reserves | ​ | 61,951 | ​ | (6,954) | ​ | 11.2% | 57,808 | ​ | (7,265) |  | 12.6% |
| Non-performing in Foreclosure – Direct reserves | ​ | 23,877 | ​ | (6,106) | ​ | 25.6% | 23,877 | ​ | (6,058) |  | 16.7% |
| Total | ​ | $367,860 | ​ | $(18,122) | ​ | ​ ​ | $376,991 | ​ | $(18,470) |  |  |

For further information, see Note 4 – Loans and Allowance for Credit Losses.

### Real Estate Owned

As of March 31, 2025, we owned twenty properties, each of which previously served as collateral for first mortgage loans. One property was acquired during the three months ended March 31, 2025 in connection with foreclosure actions.

The following table details the carrying value of each of our real estate owned properties reflected on our condensed consolidated balance sheets as of March 31, 2025:

*(in thousands)*

| ​ ​ Property Type ​ | ​ ​ | ​ ​ ​ Location ​ ​ ​ | ​ Month of Acquisition ​ | ​ ​ ​ | ​ ​ Carrying Value |
| --- | --- | --- | --- | --- | ---: |
| Commercial – Restaurant |  | Bristol, CT | March 2019 | ​ | $750 |
| Land |  | Bristol, CT | December 2019 | ​ | 1,406 |
| Land |  | Sturbridge, MA | November 2022 | ​ | 110 |
| Residential – Single Family |  | Bellingham, MA | December 2023 | ​ | 293 |
| Land |  | Stamford, CT | May 2024 | ​ | 115 |
| Land |  | Stamford, CT | May 2024 | ​ | 115 |
| Residential – Multi Family |  | Westbrook, ME | September 2024 | ​ | 298 |
| Residential – Multi Family |  | South Portland, ME | September 2024 | ​ | 550 |
| Mixed Use |  | Casco, ME | September 2024 | ​ | 300 |
| Land |  | Cape Coral, FL | October 2024 | ​ | 600 |
| Land |  | Cape Coral, FL | October 2024 | ​ | 900 |
| Land |  | Cape Coral, FL | October 2024 | ​ | 350 |
| Land |  | Cape Coral, FL | October 2024 | ​ | 350 |
| Residential – Multi Family |  | Flagler Beach, FL | October 2024 | ​ | 3,382 |
| Residential – Single Family |  | Gainesville, FL | November 2024 | ​ | 836 |
| Mixed Use |  | New London, CT | November 2024 | ​ | 1,750 |
| Land |  | New London, CT | November 2024 | ​ | 2,500 |
| Commercial – Office |  | Windsor, CT | December 2024 | ​ | 1,600 |
| Commercial – Office |  | Windsor, CT | December 2024 | ​ | 2,250 |
| Land |  | Marathon, FL | January 2025 | ​ | 410 |
| Total | ​ | ​ |  | ​ | $18,865 |

For further information, see Note 6 – Real Estate Owned (REO).

### Results of Operations

### Three months ended March 31, 2025 compared to three months ended March 31, 2024

#### Total revenue

Total revenue for the three months ended March 31, 2025 was $11.4 million compared to $16.8 million for the three months ended March 31, 2024, a decrease of $5.4 million, or 31.9%. The change in revenue was primarily due to the cumulative effect of fewer originations over the last fifteen months resulting in a reduction in the unpaid principal balance of loans held for investment in addition to a currently elevated amount of nonperforming loans and real estate owned. On the other hand, income from our preferred membership limited liability company investments increased approximately 71.7%, quarter-over-quarter.

#### Operating costs and expenses

Total operating expenses for three months ended March 31, 2025 were $10.4 million compared to $12.5 million for the three months ended March 31, 2024,a decrease of $2.1 million or 16.9%. The largest contributors to this decrease were the decreases in interest and amortization of deferred financing fees as a result of the repayment of $58.2 million of aggregate principal amount of our unsecured, unsubordinated notes in 2024, and a aggregate decrease in compensation and employee benefits, provision for credit losses related to loans held for investment, and other expenses totaling $0.9 million, partially offset by $0.01 million increase in general and administrative expenses.

#### Other income (loss)

For the three month period ended March 31, 2025, we reported a $0.1 million loss on equity securities. For the three month period ended March 31, 2024, we reported a $0.4 million gain on equity securities.

#### Net (loss) income attributable to common shareholders and net (loss) income attributable to common shareholders per share

Net loss attributable to common shareholders for the three months ended March 31, 2025 was $0.2 million, or $0.00 per share, compared to net income attributable to common shareholders of $3.6 million, or $0.08 per share, for the three months ended March 31, 2024.

#### Comprehensive (loss) income

For the three months ended March 31, 2025, we had no transactions which impact comprehensive income. For the three months ended March 31, 2024, we reported a reclassification of unrealized losses to provision for credit losses of $0.2 million reflecting the recognition of unrealized losses on securities held for over one year, which were not considered temporary losses, as well as an unrealized losses on investment securities of $0.3 million.

#### Book value per common share

The following table sets forth the calculation of our book value per common share (in thousands, except share and per share data):

| ​ ​ | ​ | ​ ​ March 31, 2025 | ​ | ​ ​ December 31, 2024 |
| --- | --- | ---: | --- | ---: |
| Total shareholders’ equity | ​ | $179,339 | ​ | $181,651 |
| Series A Preferred Stock ($25 aggregate liquidation preference) | ​ | (57,669) | ​ | (57,669) |
| Total shareholders’ equity, net of preferred stock | ​ | $121,670 | ​ | $123,982 |
| Number of Common Shares outstanding at period end | ​ | 47,310,139 | ​ | 46,965,306 |
| Book value per common share | ​ | $2.57 | ​ | $2.64 |

Book value per common share as of March 31, 2025, was $2.57, a decrease of $0.07 from our book value per common share as of December 31, 2024 of $2.64. Such decrease is primarily due to cash dividends declared and paid for the three months ended March 31, 2025 on Common Shares and Series A Preferred Stock totaling $3.5 million, or $0.07 per share.

### Liquidity and Capital Resources

Total assets at March 31, 2025 were $491.4 million compared to $492.0 million at December 31, 2024, a decrease of $0.6 million, or 0.1%. The decrease was due primarily to a $9.4 million decrease in loans held for investment, net, partially offset by a $6.3 million increase in cash and $2.4 million increase in investments in real estate, net.

Total liabilities at March 31, 2025 were $312.1 million compared to $310.3 million at December 31, 2024, an increase of $1.8 million, or 0.6%. This increase is primarily due to a $7.8 million increase in our repurchase agreements, partially offset by a $3.9 million decrease in lines of credit, a $1.7 million decrease in accounts payable and accrued liabilities, and a $1.0 decrease in advances from borrowers.

Total shareholders’ equity at March 31, 2025 was $179.3 million compared to $181.7 million at December 31, 2024, a decrease of $2.3 million, or 1.3%. This decrease was due primarily to $3.5 million in dividends paid partially offset by $0.9 million of net income for the period and $0.3 million increase in additional paid-in capital related to stock-based compensation.

#### Sources and Uses of Funds

Our primary sources of cash include principal and interest payments on mortgage loans and various fees associated with such loans, proceeds from the sales of real property, net proceeds from offerings of equity securities, and borrowings from our credit facilities. Our primary uses of cash include debt service payments (both principal and interest), new originations of loans held for investment, new investments in real estate, dividend distributions to our shareholders, and operating expenses.

These sources and uses of cash are reflected in our Condensed Consolidated Statements of Cash Flows as summarized below:

*(in thousands)*

*(in thousands)*

| ​ ​ Amount ​ | ​ ​ | ​ ​ Three Months Ended 2025 | ​ ​ | ​ ​ 2024 ​ ​ | ​ ​ ​ | ​ ​ One Year-Change Amount | ​ ​ ​ Percentage ​ ​ ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | ---: |
| Cash and cash equivalents, January 1 | ​ | $18,066 | ​ | $12,598 | ​ | $5,468 | 43.4% |
| Net cash provided by operating activities | ​ | 191 | ​ | 4,217 | ​ | (4,026) | (95.5)% |
| Net cash provided by investing activities | ​ | 5,747 | ​ | 4,319 | ​ | 1,428 | 33.1% |
| Net cash provided by (used in) financing activities | ​ | 410 | ​ | (2,721) | ​ | 3,131 | 115.1% |
| Cash and cash equivalents, March 31 | ​ | $24,414 | ​ | $18,413 | ​ | $6,001 | 30.3% |

For a detailed breakdown of our cash flows during the three months ended March 31, 2025 and 2024, see the statement of cash flows included in our accompanying condensed consolidated financial statements.

We project anticipated cash requirements for our operating needs as well as cash flows generated from operating activities available to meet these needs. Our short-term cash requirements primarily include funding of loans, dividend payments, interest and principal payments on our indebtedness, including repayment/refinancing of the Notes maturing in September 2025, and payments for usual and customary operating and administrative expenses, such as employee compensation and sales and marketing expenses. Based on this analysis, we believe that our current cash balances, availability on our debt facilities, and our anticipated cash flows from operations will be sufficient to fund the operations for the next 12 months.

Our long-term cash needs will include principal and interest payments on outstanding indebtedness maturing late in 2026 and early 2027, preferred stock dividends and funding of new mortgage loans. Funding for long-term cash needs will come from unused net proceeds from financing activities, operating cash flows, refinancing existing debt, and proceeds from sales of real estate owned.

On March 20, 2025, we entered into a new Credit Agreement with Needham Bank, replacing the prior Needham Credit Facility, which was fully repaid and terminated on the same date. The new facility matures on March 2, 2026, and includes an option to extend the term by one year upon satisfaction of certain conditions. Under the new agreement, SN Holdings LLC (“SN Holdings”), our wholly owned subsidiary, serves as the borrower, and Sachem Capital, the parent, serves as guarantor of all obligations. The Needham Credit Facility is secured by a first priority lien on all the assets of SN Holdings, and includes a requirement that SN Holdings maintain assets equal to at least two times the outstanding principal balance under the facility. In addition, SN Holdings is required to collaterally assign to Needham Bank a portfolio of mortgage loans with an outstanding principal balance of no less than the greater of $30 million or the full drawn balance on the facility. Sachem Capital, as guarantor, has also granted Needham a blanket lien on substantially all of its assets, with the ability to request lien releases to facilitate other financings. The Needham Credit Facility, at the subsidiary borrower level, is subject to other terms and conditions, including representations and warranties, covenants and agreements typically found in these types of financing arrangements, including a covenant that requires SN Holdings to maintain: (A) a ratio of Adjusted EBITDA (as defined in the Credit Agreement) to Debt Service (as defined in the Credit Agreement) of not less than 1.40 to 1.0, tested on a trailing-twelve-month basis at the end of each fiscal quarter; (B) a sum of cash, cash equivalents (at the consolidated guarantor level) and availability under the facility equal to or greater than $10 million; and (C) an Asset Coverage Ratio (as defined) of at least 150%. As of March 31, 2025, SN Holdings had borrowed $36.1 million under the facility. The Company was in compliance with all covenants under the new agreement as of March 31, 2025. On April 1, 2025, SN Holdings made a principal payment of $9.9 million, further reducing the outstanding indebtedness to $26.2 million.

A copy of the Credit, Security and Guaranty Agreement, dated as of March 20, 2025, among SN Holdings, Sachem and Needham, is filed as Exhibit 10.8 to this Report.

### Off-Balance Sheet Arrangements

We are not a party to any off-balance sheet transactions, arrangements or other relationships with unconsolidated entities or other persons that are likely to affect liquidity or the availability of our requirements for capital resources.

### Contractual Obligations

As of March 31, 2025, our contractual obligations include unfunded amounts of any outstanding construction loans and unfunded commitments for loans and limited liability company investments.

*(In thousands)*

| ​ ​ ​ ​ | ​ ​ ​ | ​ ​ ​ ​ Total | ​ ​ | ​ ​ Less than 1 year | ​ ​ | ​ ​ 1 – 3 years | ​ ​ | ​ ​ 3 – 5 years | ​ ​ | ​ ​ More than 5 years |
| --- | --- | ---: | --- | ---: | --- | ---: | --- | ---: | --- | ---: |
| Unfunded portions of outstanding construction loans | ​ | $46,416 | ​ | $20,903 | ​ | $25,513 | ​ | $— | ​ | $— |
| Unfunded commitments | ​ | 4,771 | ​ | ​ 4,771 | ​ | ​ — | ​ | ​ — | ​ | ​ — |
| Total contractual obligations | ​ | $51,187 | ​ | $25,674 | ​ | $25,513 | ​ | $— | ​ | $— |

### Recent Accounting Pronouncements

See “Note 2 — Significant Accounting Policies” to the unaudited condensed consolidated financial statements for explanation of recent accounting pronouncements impacting us.

## Controls and procedures

As filed, 1,665 characters.

### (a) Evaluation and Disclosure Controls and Procedures

As of March 31, 2025, the Company carried out an evaluation, under the supervision and with the participation of its Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, the Company’s Principal Executive Officer and Principal Financial Officer concluded that the Company’s disclosure controls and procedures were not effective as of March 31, 2025, due to the material weakness in internal control over financial reporting previously identified in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, related to stock-based compensation.

The Company is actively engaged in implementing its remediation plan to address this material weakness, including strengthening the review and approval processes for equity awards and improving oversight controls related to the terms of its equity compensation plans. These remediation efforts were ongoing as of March 31, 2025.

### (b) Changes in Internal Control Over Financial Reporting

Other than the remediation efforts described above, there was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) identified in connection with the evaluation required by Rules 13a-15(d) or 15d-15(d) that occurred during the fiscal quarter ended March 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Filed May 1, 2025.
Source: SEC EDGAR, the filing index for accession 0001410578-25-001059. Last ingested by Listed: Oct 24, 2026, 15:15 ET. No prices; not investment advice.