Sunrise Realty Trust, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, and summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. An evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Annual Report was made under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of December 31, 2025. Notwithstanding the foregoing, any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in the Company’s periodic reports. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a‐15(f) and 15d-15(f) of the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures are being made only in accordance with authorizations of management and our directors; and (iii) provide reasonable assurance regarding prevention or timely detection of the unauthorized acquisition, use or disposition of assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, using the framework specified in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on such assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2025. This Annual Report does not include an attestation report of our independent registered public accounting firm regarding control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to Section 989G of the Dodd-Frank Wall Street and Consumer Protection Act, which exempts non-accelerated filers from the auditor attestation requirement of Section 404(b) of the Sarbanes-Oxley Act. Effectiveness of Internal Control It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there is only the reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions. 83 Table of Contents Changes in Internal Control over Financial Reporting There have been no changes to our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended December 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. Other Information Insider Trading Arrangements None of the Company’s directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in paragraph (c) of Item 408(a) of Regulation S-K) during the Company’s fiscal quarter ended December 31, 2025. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. PART III Item 10. Directors, Executive Officers and Corporate Governance Except as set forth below, the other information required by this item will be contained in the Company’s definitive proxy statement for its 2026 Annual Shareholder Meeting, to be filed with the SEC within 120 days after December 31, 2025, and is incorporated herein by reference. Code of Business Conduct and Ethics We have adopted a Code of Business Conduct and Ethics for our directors, officers (including our principal executive officer, principal financial officer and principal accounting officer) and employees. A current copy of the code is posted under “Corporate Governance” on our website at https://ir.sunriserealtytrust.com/corporate-governance/governance-overview . To the extent required by rules adopted by the Securities and Exchange Commission and Nasdaq, we intend to promptly disclose future amendments to certain provisions of the Code of Business Conduct and Ethics, or waivers of such provisions granted to executive officers and directors on our website at https://ir.sunriserealtytrust.com/corporate-governance/governance-overview . Item 11. Executive Compensation The information required by this item is incorporated by reference to the Company’s definitive proxy statement for its 2026 Annual Shareholder Meeting, to be filed with the SEC within 120 days after December 31, 2025 and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this item is incorporated by reference to the Company’s definitive proxy statement for its 2026 Annual Shareholder Meeting, to be filed with the SEC within 120 days after December 31, 2025 and is incorporated herein by reference. Item 13. Certain Relationships and Related Party Transactions, and Director Independence The information required by this item is incorporated by reference to the Company’s definitive proxy statement for its 2026 Annual Shareholder Meeting, to be filed with the SEC within 120 days after December 31, 2025 and is incorporated herein by reference. Item 14. Principal Accountant Fees and Services The information required by this item is incorporated by reference to the Company’s definitive proxy statement for its 2026 Annual Shareholder Meeting, to be filed with the SEC within 120 days after December 31, 2025 and is incorporated herein by reference. 84 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (1) Financial Statements—See the Index to Consolidated Financial Statements, together with the report thereon of CohnReznick LLP dated March 12, 2026, beginning on Page F-1. (2) Financial Statement Schedules—None. We have omitted financial statement schedules because they are not required or are not applicable, or the required information is shown in the financial statements or notes to the financial statements. (3) Exhibits. Exhibit No. Description of Exhibits 2.1 Separation and Distribution Agreement, dated as of July 8, 2024, by and between Advanced Flower Capital Inc. (f/k/a AFC Gamma, Inc.) and Sunrise Realty Trust, Inc. (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K on July 8, 2024 and incorporated herein by reference). 3.1 Articles of Amendment and Restatement of Sunrise Realty Trust, Inc. (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K on July 3, 2024 and incorporated herein by reference). 3.2 Amended and Restated Bylaws of Sunrise Realty Trust, Inc. (filed as Exhibit 3.2 to Amendment No. 2 to the Company’s Registration Statement on Form 10-12B on May 20, 2024 and incorporated herein by reference). 4.1 Description of the Registrant’s Securities (filed as Exhibit 4.1 to the Company’s Annual Report on Form 10-K on March 6, 2025 and incorporated herein by reference). 10.1 Tax Matters Agreement, dated as of July 8, 2024, by and between Advanced Flower Capital Inc. (f/k/a AFC Gamma, Inc.) and Sunrise Realty Trust, Inc. (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K on July 8, 2024 and incorporated herein by reference). 10.2 Management Agreement, dated as of February 22, 2024 (filed as Exhibit 10.2 to Amendment No. 2 to the Company’s Registration Statement on Form 10-12B on May 20, 2024 and incorporated herein by reference). 10.3§ Form of Indemnification Agreement (filed as Exhibit 10.3 to Amendment No. 3 to the Company’s Registration Statement on Form 10-12B on June 10, 2024 and incorporated herein by reference). 10.4§ 2024 Stock Incentive Plan (filed as Exhibit 10.4 to Amendment No. 3 to the Company’s Registration Statement on Form 10-12B on June 10, 2024 and incorporated herein by reference). 10.5§ Form of 2024 Stock Incentive Plan Restricted Stock Agreement (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q on November 7, 2024 and incorporated herein by reference). 10.6 Unsecured Revolving Credit Agreement, dated September 26, 2024, by and between Sunrise Realty Trust, Inc., as borrower, and SRT Finance LLC, as agent and lender (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K on September 26, 2024 and incorporated herein by reference). 1 0.7 Unsecured Revolving Credit Agreement, dated December 9, 2024, by and among Sunrise Realty Trust, Inc. as borrower, the lenders party thereto from time to time and SRT Finance LLC, as agent and lender (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K on December 9, 2024 and incorporated herein by reference). 1 0. 7A * Amendment Number One to Unsecured Revolving Credit Agreement, dated December 30, 2025, by and among Sunrise Realty Trust, Inc. as borrower, the lenders party thereto from time to time and SRT Finance LLC, as agent and lender. 10.8 Loan and Security Agreement, dated as of November 6, 2024, among Sunrise Realty Trust, Inc., as borrower, the lenders party thereto, and East West Bank, as Agent, Joint Lead Arranger, Joint Book Runner, Co-Syndication Agent and Co-Documentation Agent (filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q on November 7, 2024 and incorporated herein by reference). 10. 8 A Amendment to Loan and Security Agreement, dated as of December 9, 2024, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, the lenders party thereto, and East West Bank, as Agent, Joint Lead Arranger and Joint Book Runner (filed as Exhibit 10.7 to the Company’s Registration Statement on Form S-11 on January 21, 2025 and incorporated herein by reference). 85 Table of Contents 10. 8 B Amendment Number Two to Loan and Security Agreement, dated as of December 30, 2024, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as agent, joint lead arranger, co-syndication agent and co-documentation agent, and the financial institutions party thereto, as lenders (filed as Exhibit 10.8 to the Company’s Registration Statement on Form S-11 on January 21, 2025 and incorporated herein by reference). 10. 8 C Amendment Number Three to Loan and Security Agreement, dated as of February 26, 2025, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as agent, joint lead arranger, co-syndication agent and co-documentation agent, and the financial institutions party thereto, as lenders (filed as Exhibit 10.11 to the Company’s Annual Report on Form 10-K on March 6, 2025 and incorporated herein by reference). 10. 8 D Amendment Number Four to Loan and Security Agreement, dated as of May 16, 2025, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as agent, sole book runner, co-syndication agent and co-documentation agent, East West Bank and City National Bank of Florida, as joint lead arrangers, and the lenders party thereto (filed as Exhibit 10.12 to the Company’s Current Report on Form 8-K on May 20, 2025 and incorporated herein by reference). 10. 8 E Amendment Number Five to Loan and Security Agreement, dated as of May 29, 2025, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as administrative agent, sole book runner, co-syndication agent and co-documentation agent, East West Bank, City National Bank of Florida and Everbank, N.A., as joint lead arrangers, and the lenders party thereto (filed as Exhibit 10.13 to the Company’s Current Report on Form 8-K on May 29, 2025 and incorporated herein by reference). 10. 8 F Amendment Number Six to Loan and Security Agreement, dated as of November 7, 2025, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as administrative agent, sole book runner, co-syndication agent and co-documentation agent, East West Bank, City National Bank of Florida and EverBank, N.A., as joint lead arrangers, and the lenders party thereto (filed as Exhibit 10.14 to the Company’s Quarterly Report on Form 10-Q on November 13, 2025 and incorporated herein by reference). 1 0.8G Amendment Number Seven to Loan and Security Agreement, dated as of February 27, 2026, among Sunrise Realty Trust, Inc. and Sunrise Realty Trust Holdings I LLC, as borrowers, East West Bank, as administrative agent, sole book runner, co-syndication agent and co-documentation agent, East West Bank, City National Bank of Florida, EverBank, N.A. and Customers Bank, as joint lead arrangers, and the lenders party thereto (filed as Exhibit 10.9G to the Company’s Current Report on Form 8-K on March 5, 2026 and incorporated herein by reference). 1 0. 9 Equity Distribution Agreement, dated August 13, 2025, by and among the Company, the Manager and Raymond James & Associates, Inc. (filed as Exhibit 1.1 to the Company’s Current Report on Form 8-K on August 13, 2025 and incorporated herein by reference). 19 Insider Trading Policy (filed as Exhibit 19 to the Company’s Annual Report on Form 10-K on March 6, 2025 and incorporated herein by reference). 21.1 List of Subsidiaries of the Registrant (filed as Exhibit 21.1 to the Company’s Registration Statement on Form S-11 on January 21, 2025 and incorporated herein by reference). 23.1* Consent of CohnReznick LLP, independent registered public accounting firm. 31.1* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1** Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2** Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97 Clawback Policy (filed as Exhibit 97 to the Company’s Annual Report on Form 10-K on March 6, 2025 and incorporated herein by reference). 101.INS Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document. 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. 86 Table of Contents 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) § Management contract or compensatory plan or arrangement * Filed herewith ** Furnished herewith Item 16. Form 10-K Summary None. 87 Table of Contents INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm CohnReznick LLP (PCAOB ID 596 ), Baltimore, Maryland F- 2 Consolidated Balance Sheets as of December 31, 2025 and 2024 F- 3 Consolidated Statements of Operations for the years ended December 31, 2025 and 2024 and 2024 F- 4 Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2025 and 2024 F- 5 Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 F- 6 Notes to Consolidated Financial Statements F- 7 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Shareholders Sunrise Realty Trust, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Sunrise Realty Trust, Inc. and subsidiaries, as of December 31, 2025 and 2024, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Sunrise Realty Trust, Inc. and subsidiaries as of December 31, 2025 and 2024, and the results of their operations and their cash flows for the years then ended , in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to Sunrise Realty Trust, Inc. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Sunrise Realty Trust, Inc. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ CohnReznick LLP We have served as Sunrise Realty Trust, Inc.’s auditor since 2023. Baltimore, Maryland March 12, 2026 F-2 Table of Contents SUNRISE REALTY TRUST, INC. CONSOLIDATED BALANCE SHEETS As of December 31, 2025 2024 Assets Loans held for investment at carrying value, net $ 302,674,743 $ 130,733,630 Current expected credit loss reserve ( 1,891,170 ) ( 21,782 ) Loans held for investment at carrying value, net of current expected credit loss reserve 300,783,573 130,711,848 Cash and cash equivalents 6,445,328 184,626,770 Interest receivable 2,264,133 1,138,561 Prepaid expenses and other assets 735,230 1,058,601 Total assets $ 310,228,264 $ 317,535,780 Liabilities Accrued interest $ 730,644 $ 131,617 Dividends payable 4,026,296 2,941,964 Current expected credit loss reserve 178,066 18,398 Accrued management and incentive fees 692,716 393,063 Accrued direct administrative expenses 282,296 715,574 Accounts payable and other liabilities 355,865 357,417 Line of credit payable 102,250,000 123,840,000 Line of credit payable to affiliate 19,750,000 75,000,000 Total liabilities 128,265,883 203,398,033 Commitments and contingencies (Note 7) Shareholders' equity Preferred stock, par value $ 0.01 per share, 10,000 shares authorized at December 31, 2025 and 2024 and 0 shares issued and outstanding at December 31, 2025 and 2024, respectively — — Common stock, par value $ 0.01 per share, 50,000,000 shares authorized at December 31, 2025 and 2024 and 13,420,986 and 7,004,676 shares issued and outstanding at December 31, 2025 and 2024, respectively 134,210 70,047 Additional paid-in capital 186,745,489 115,022,034 Accumulated (deficit) earnings ( 4,917,318 ) ( 954,334 ) Total shareholders' equity 181,962,381 114,137,747 Total liabilities and shareholders' equity $ 310,228,264 $ 317,535,780 See accompanying notes to the consolidated financial statements F-3 Table of Contents SUNRISE REALTY TRUST, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Years ended December 31, 2025 2024 Revenue Interest income $ 26,373,418 $ 10,844,718 Interest expense ( 4,801,984 ) ( 216,268 ) Net interest income 21,571,434 10,628,450 Expenses Management and incentive fees 2,454,130 815,301 General and administrative expenses 2,896,724 1,291,021 Stock-based compensation 1,019,168 338,404 Professional fees 1,029,947 1,275,123 Total expenses 7,399,969 3,719,849 Provision for current expected credit losses ( 2,029,056 ) ( 40,180 ) Net income before income taxes 12,142,409 6,868,421 Income tax expense — — Net income $ 12,142,409 $ 6,868,421 Earnings per common share: Basic $ 0.93 $ 1.01 Diluted $ 0.93 $ 1.00 Weighted average number of common shares outstanding: Basic 12,742,894 6,800,841 Diluted 12,774,328 6,835,797 See accompanying notes to the consolidated financial statements F-4 Table of Contents SUNRISE REALTY TRUST, INC. CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Year ended December 31, 2025 Member's Equity Common Stock Additional Paid-In Capital Accumulated Earnings (Deficit) Total Shareholders' Equity Shares Amount Balance as of December 31, 2024 $ — 7,004,676 $ 70,047 $ 115,022,034 $ ( 954,334 ) $ 114,137,747 Issuance of common stock, net of offering costs — 6,400,000 64,000 70,704,450 — 70,768,450 Stock-based compensation, net of forfeitures — 16,310 163 1,019,005 — 1,019,168 Dividends declared on common shares ($ 1.20 per share) — — — — ( 16,105,393 ) ( 16,105,393 ) Net income — — — — 12,142,409 12,142,409 Balance as of December 31, 2025 $ — 13,420,986 $ 134,210 $ 186,745,489 $ ( 4,917,318 ) $ 181,962,381 Year ended December 31, 2024 Member's Equity Common Stock Additional Paid-In Capital Accumulated Earnings (Deficit) Total Shareholders' Equity Shares Amount Balance as of December 31, 2023 $ 31,234,622 — $ — $ — $ — $ 31,234,622 Effect of corporate conversion on member's equity ( 31,234,622 ) 100 1 30,999,999 234,622 — Stock-based compensation — 115,644 1,157 325,747 — 326,904 Dividends declared on common shares ($ 0.63 per share) — — — — ( 4,396,297 ) ( 4,396,297 ) Issuance of common stock in connection with the Spin-Off — 6,888,932 68,889 69,296,288 — 69,365,177 Net transfers and distributions from (to) Former Parent — — — 14,400,000 ( 3,661,080 ) 10,738,920 Net income — — — — 6,868,421 6,868,421 Balance as of December 31, 2024 $ — 7,004,676 $ 70,047 $ 115,022,034 $ ( 954,334 ) $ 114,137,747 See accompanying notes to the consolidated financial statements F-5 Table of Contents SUNRISE REALTY TRUST, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31, 2025 2024 Operating activities: Net income $ 12,142,409 $ 6,868,421 Adjustments to reconcile net income to net cash (used in) provided by operating activities: Provision for current expected credit losses 2,029,056 40,180 Amortization of deferred financing costs 477,989 41,455 Accretion of deferred loan original issue discount and premium, net ( 1,481,495 ) ( 263,102 ) Stock-based compensation 1,019,168 326,904 Interest drawn on loans ( 17,354,062 ) ( 5,291,615 ) PIK interest ( 45,722 ) — Changes in operating assets and liabilities: Interest receivable ( 1,125,572 ) ( 1,138,561 ) Prepaid expenses and other assets 445,998 ( 530,818 ) Accrued interest 599,027 131,617 Accrued management and incentive fees 299,653 393,063 Accrued direct administrative expenses ( 433,278 ) 715,574 Accounts payable and other liabilities ( 3,749 ) 347,417 Net cash (used in) provided by operating activities ( 3,430,578 ) 1,640,535 Cash flows from investing activities: Issuance of and fundings on loans ( 204,576,675 ) ( 158,339,598 ) Principal repayment of loans 51,516,841 33,160,685 Net cash used in investing activities ( 153,059,834 ) ( 125,178,913 ) Cash flows from financing activities: Net transfers and distributions from (to) Former Parent — 80,104,097 Proceeds from sale of common stock 72,588,000 — Payment of offering costs - equity offering ( 1,817,353 ) — Payment of financing costs ( 600,616 ) ( 569,238 ) Borrowings on revolving credit facilities 214,060,000 248,840,000 Repayment of revolving credit facilities ( 290,900,000 ) ( 50,000,000 ) Dividends paid to common shareholders ( 15,021,061 ) ( 1,454,333 ) Net cash (used in) provided by financing activities ( 21,691,030 ) 276,920,526 Net (decrease) increase in cash and cash equivalents ( 178,181,442 ) 153,382,148 Cash and cash equivalents, beginning of period 184,626,770 31,244,622 Cash and cash equivalents, end of period $ 6,445,328 $ 184,626,770 Supplemental disclosure of non-cash activity: OID withheld from funding of loans $ 2,097,728 $ 2,085,761 Dividends declared and not yet paid $ 4,026,296 $ 2,941,964 Offering costs included in accounts payable and other liabilities $ 2,197 $ — Supplemental information: Interest paid during the period $ 3,724,968 $ 43,197 Income taxes paid during the period $ — $ — See accompanying notes to the consolidated financial statements F-6 Table of Contents SUNRISE REALTY TRUST, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2025 1. ORGANIZATION Sunrise Realty Trust, Inc. (the “Company” or “SUNS”) was formed on August 28, 2023, and converted from a Delaware limited liability company to a Maryland corporation in February 2024. The Company is an institutional lender that provides debt capital solutions to the commercial real estate (“CRE”) market in the Southern United States, with a primary focus on opportunities in Arizona, Florida, Georgia, Nevada, North Carolina, South Carolina, Tennessee and Texas. The Company focuses on originating, underwriting and managing CRE debt investments and providing capital to high-quality borrowers and sponsors with transitional business plans collateralized by CRE assets with opportunities for near-term value creation, as well as recapitalization opportunities. The Company intends to further diversify its investment portfolio, targeting investments in senior mortgage loans, mezzanine loans, B-notes, commercial mortgage-backed securities (“CMBS”) and debt-like preferred equity securities across CRE asset classes. The Company intends for its investment mix to include high quality residential (including multi-family, condominiums and single-family residential communities), retail, office, hospitality, industrial, mixed-use and specialty-use real estate. The Company operates in one operating segment. SUNS is externally managed and advised by Sunrise Manager LLC (“SUNS Manager” or the “Manager”), a registered investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”) . The Company consolidates all of its subsidiaries, which are consolidated within the Company’s consolidated financial statements. The Company has elected to be taxed as a REIT for United States federal income tax purposes under the Internal Revenue Code (the “Code”), commencing with the taxable year ending December 31, 2024. The Company generally will not be subject to United States federal income taxes on its REIT taxable income as long as it annually distributes all of its REIT taxable income prior to the deduction for dividends paid to shareholders and complies with various other requirements as a REIT. Spin-Off On July 9, 2024, Advanced Flower Capital Inc. (“AFC” or the “Former Parent”) announced the completion of the previously announced separation (the “Separation”) and spin-off of AFC’s CRE portfolio into an independent, publicly traded company, SUNS (the “Spin-Off”). The Spin-Off was effected by the transfer of AFC’s CRE portfolio from AFC to SUNS and the distribution of all of the outstanding shares of SUNS’ common stock, par value $ 0.01 per share (the “Common Stock”) to all of AFC’s shareholders of record (the “Distribution”) as of the close of business on July 8, 2024 (the “Record Date”). AFC’s shareholders of record as of the Record Date received one share of Common Stock for every three shares of AFC common stock held as of the Record Date. The Spin-Off was completed on July 9, 2024 (the “Distribution Date”). On the Distribution Date, SUNS became an independent, publicly traded company, trading on the Nasdaq Stock Market LLC under the symbol “SUNS.” AFC retained no ownership interest in the Company following the Spin-Off. In connection with the Spin-Off, the Company entered into several agreements with AFC that govern the relationship between the Company and AFC following the Spin-Off, including the separation and distribution agreement (the “Separation and Distribution Agreement”) and a tax matters agreement (the “Tax Matters Agreement”). These agreements provide for the allocation between AFC and SUNS of the assets, liabilities and obligations (including, among others, investments, property and tax-related assets and liabilities) of AFC and its subsidiaries attributable to periods prior to, at and after the Spin-Off. Moreover, in preparation for the Spin-Off, the management of SUNS entered into a new management agreement with SUNS Manager, which became effective concurrently with the completion of the Spin-Off. The Manager also entered into (i) an Administrative Services Agreement (the “Administrative Services Agreement”) with TCG Services LLC, an affiliate of the Manager and Leonard Tannenbaum, the Company’s Executive Chairman, and Robyn Tannenbaum, the Company’s President, and (ii) a Services Agreement (the “Services Agreement”) with SRT Group LLC, an affiliate of the Manager, Mr. Tannenbaum, Mrs. Tannenbaum, Mr. Sedrish and Mr. Hetzel. 2. SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements and related notes have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company, and its wholly-owned subsidiaries. The consolidated financial statements reflect all F-7 Table of Contents adjustments that, in the opinion of management, are necessary for the fair presentation of the Company’s results of operations and financial condition as of and for the periods presented. All intercompany balances and transactions have been eliminated in consolidation. The historical financial statements of the Company for the periods prior to the completion of the Spin-Off are prepared from AFC’s historical accounting records and are presented on a standalone basis as if the Company’s operations have been conducted independently from AFC. This Annual Report on Form 10-K presents the financial information of the Company for the fiscal years ended December 31, 2025 and 2024, which includes the period from January 1, 2024 to July 8, 2024 (prior to consummation of the Separation, the Distribution and the Spin-Off) and the period from July 9, 2024 to December 31, 2024 (from and after consummation of the Separation, the Distribution and the Spin-Off). The aggregate net effect of transactions between the Company and related parties that have been historically settled other than in cash are reflected in the Balance Sheets as Member’s Equity and Shareholder’s Equity and in the Statements of Cash Flows as Net Transfers and Distributions From (to) Former Parent. For additional information, see Note 12, “Related Party Transactions,” and Note 8, “Shareholders’ Equity.” Cash and Cash Equivalents Cash and cash equivalents include funds on deposit with financial institutions, including demand deposits with financial institutions. Cash and short-term investments with an original maturity of three months or less when acquired are considered cash and cash equivalents for the purpose of the consolidated balance sheets and consolidated statements of cash flows. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, loans and interest receivable. The Company places its cash and cash equivalents with financial institutions, and, at times, cash held exceeds the Federal Deposit Insurance Corporation insured limit. The Company and the Manager seek to manage this credit risk by monitoring the financial institutions and their ability to continue in business for the foreseeable future. The Company has exposure to credit risk on its loans and interest receivable. The Company and the Manager seek to manage credit risk by performing due diligence prior to origination or acquisition and through the use of non-recourse financing, when and where available and appropriate. Investments in Loans The Company originates CRE debt and related instruments generally to be held for investment. Loans held for investment are carried at cost, net of unamortized loan original issue discount and origination costs and other original issue discounts (the “carrying value”) in the Company’s balance sheets. Although we generally hold our target investments as long-term loans, we may occasionally classify some of our loans as held for sale. Loans held for sale are carried at fair value, with changes in fair value recorded through earnings. Loans are generally collateralized by real estate, equipment, and/or other assets of borrowers to the extent permitted by applicable laws and the regulations governing such borrowers. The extent of any credit deterioration associated with the performance and/or value of the underlying collateral property and the financial and operating capability of the borrower could impact the expected amounts received. The Company monitors performance of its portfolio of loans held for investment under the following methodology: (i) borrower review, which analyzes the borrower’s ability to execute on its original business plan, reviews its financial condition, assesses pending litigation and considers its general level of responsiveness and cooperation; (ii) economic review, which considers underlying collateral (i.e., leasing performance, unit sales and cash flow of the collateral and its ability to cover debt service, as well as the residual loan balance at maturity); (iii) property review, which considers current environmental risks, changes in insurance costs or coverage, current site visibility, capital expenditures and market perception; and (iv) market review, which analyzes the collateral from a supply and demand perspective of similar property types, as well as from a capital markets perspective. The Company may make modifications to lo ans, including loans that are in default. Loan terms that may be modified include interest rates, required prepayments, maturity dates, covenants, principal amounts and other loan terms. The terms and conditions of each modification vary based on individual circumstances and will be determined on a case-by-case basis. The Company’s Manager monitors and evaluates each of the Company’s loans held for investment and has maintained regular communications with borrowers. F-8 Table of Contents The Company accretes or amortizes any discounts or premiums on loans held for investment over the life of the related loan held for investment utilizing the effective interest method. Fair Value Measurements The Company follows ASC 820-10, Fair Value Measurement (“ASC 820-10”), within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), which defines fair value, establishes a framework for measuring fair value, and requires certain disclosures regarding fair value measurements. ASC 820-10 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Company to assume that the transaction is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820-10, if the Company elects the fair value option under ASC 825-10, Financial Instruments, the Company would consider its principal market as the market in which the Company exits its loans with the greatest volume and level of activity. ASC 820-10 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. In accordance with ASC 820-10, these inputs are summarized in the three broad levels listed below: • Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. • Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. • Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement. If inputs used to measure fair value fall into different levels of the fair value hierarchy, a loan’s level is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the loan. This includes loans that are valued using “bid” and “ask” prices obtained from independent third-party pricing services or directly from brokers. Financial instruments with readily available quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value. As such, the Company obtains and analyzes readily available market quotations provided by pricing vendors and brokers for all of the Company’s loans for which quotations are available. In determining the fair value of a particular loan, pricing vendors and brokers use observable market information, including both binding and non-binding indicative quotations. GAAP requires disclosure of fair value information about financial and nonfinancial assets and liabilities, whether or not recognized in the financial statements, for which it is practical to estimate the value. In cases where quoted market prices are not available, fair values are based upon the application of discount rates to estimated future cash flows using market yields, or other valuation methodologies. Any changes to the valuation methodology will be reviewed by the Company’s management to ensure the changes are appropriate. The methods used may produce a fair value calculation that is not indicative of net realizable value or reflective of future fair values. Furthermore, while the Company anticipates that the valuation methods are appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value of certain financial and nonfinancial assets and liabilities could result in a different estimate of fair value at the reporting date. The Company uses inputs that are current as of the measurement date, which may fall within periods of market dislocation, during which price transparency may be reduced. Current Expected Credit Losses The Company measures current expected credit losses (“CECL”) in accordance with ASC Topic 326, Financial Instruments - Credit Losses (“ASC 326”), which requires a methodology that reflects on both the outstanding balances and unfunded commitments on loans held for investment and requires consideration of a broader range of historical experience adjusted for current conditions and reasonable and supportable forecast information to derive credit loss estimates (the “CECL Reserve”). Subsequent period increases and decreases to expected credit losses impact earnings and are recorded within the provision for current expected credit losses in the Company’s statements of operations. The CECL Reserve related to outstanding balances on loans held for investment required under ASC 326 is a valuation account that is deducted from the amortized cost basis of the Company’s loans held at carrying value in the Company’s balance sheets. The CECL Reserve related to unfunded commitments on loans held at carrying value is recorded within the current expected credit F-9 Table of Contents loss reserve financial statement line in the Company’s balance sheets. The Company has elected not to measure an allowance for credit losses for accrued interest receivable. The Company estimates its CECL Reserve using a model that considers multiple datapoints and methodologies that may include discounted cash flows (“DCF”) and other inputs which may include the risk rating of the loan, how recently the loan was originated compared to the measurement date, and expected prepayment if applicable. Calculation of the CECL Reserve requires loan specific data, which may include fixed charge coverage ratio, loan-to-value, property type and geographic location. Estimating the CECL Reserve also requires significant judgment with respect to various factors, including but not limited to the expected timing of loan repayments and the Company’s current and future view of the macroeconomic environment. The Company may consider loan-specific qualitative factors on certain loans to estimate its CECL Reserve, which may include (i) whether cash from the borrower’s operations is sufficient to cover the debt service requirements currently and into the future, (ii) the ability of the borrower to refinance the loan and (iii) the liquidation value of collateral. For loans where the Company has deemed the borrower/sponsor to be experiencing financial difficulty, the Company may elect to apply a practical expedient in which the fair value of the underlying collateral is compared to the amortized cost of the loan in determining a specific CECL allowance. Revenue Recognition Interest income from loans is accrued based on the outstanding principal amount and the contractual terms of each loan. For loans, origination fees, direct loan origination costs, and other discounts (in aggregate the “Original Issue Discount” or “OID”) are also recognized in interest income from loans over the initial loan term as a yield adjustment using the effective interest method. Management places loans on nonaccrual status when principal or interest payments are past due 30 days or more or when full recovery of interest and principal is doubtful. Accrued and unpaid interest is generally reversed against interest income in the period the loan is placed on nonaccrual status. Interest payments received on nonaccrual loans are generally recognized on a cash basis and may be recognized as income or applied to principal depending upon management’s judgment regarding the borrower’s ability to make pending principal and interest payments. Nonaccrual loans are restored to accrual status when past due principal and interest are paid and, in management’s judgment, are likely to remain current. The Company may make exceptions to placing a loan on nonaccrual status if the loan has sufficient collateral value and is in the process of collection. Delayed draw loans earn interest or unused fees on the undrawn portion of the loan, which is recognized as interest income in the period earned. Other fees, including prepayment fees and exit fees, are recognized as interest income when received. Stock-Based Compensation The Company accounts for stock-based compensation issued to employees and the Board of Directors pursuant to the Amended and Restated Stock Incentive Plan (the “2024 Plan”) under the fair value method. This method measures compensation cost at the date of grant based on the value of the award and recognizes the cost over the service period, which is usually the vesting period. The fair value of equity-based compensation awards is based on the estimated fair value of the Company’s Common Stock , as determined by management using a valuation model and approved by the Board of Directors. Fair values of award grants also recognize any ongoing restrictions on the sale of securities. Offering Costs Direct and incremental costs related to the issuance of stock such as legal fees, printing costs and bankers’ or underwriters’ fees are accounted for as a reduction in the proceeds from the sale of the stock and accordingly, recorded as a reduction of equity in the Company’s consolidated statement of equity within additional paid-in capital. Prior to the effective date of an equity offering, these costs are deferred and included in prepaid expenses and other assets on the Company’s consolidated balance sheets. Should the offering be abandoned and not completed, the deferred costs will be expensed. Debt Issuance Costs Debt issuance costs related to the Company’s indebtedness are capitalized and amortized over the term of the respective debt instrument utilizing the effective interest method. Unamortized debt issuance costs are expensed when the associated debt is repaid prior to maturity. Amortization of debt issuance costs is included within interest expense in the Company’s consolidated statements of operations. The unamortized balance for the revolving credit facilities are recorded within prepaid expenses and other assets on these consolidated financial statements. See Note 6 included in these consolidated financial statements for further consideration. F-10 Table of Contents Interest Drawn on Loans The Company has loans in its portfolio that contain provisions for funded interest. The interest drawn on loans is computed at the contractual rate specified in each applicable agreement and is accrued and added to the principal balance of the loan monthly in arrears and recorded as interest income. The interest income that is drawn on the loans is added to the principal balance and is generally collected upon repayment of the outstanding principal. To maintain the Company’s status as a REIT, this non-cash source of income is included in taxable income and will increase the dividend paid to shareholders for the year earned, even though the Company has not yet collected the cash. Income Taxes The Company is a Maryland corporation and elected to be taxed as a REIT under the Code, commencing with its taxable year ended December 31, 2024. The Company believes that its proposed method of operation will enable it to remain qualified as a REIT. However, no assurances can be given that the Company’s beliefs or expectations will be fulfilled, since qualification as a REIT depends on the Company satisfying numerous asset, income and distribution tests which depend, in part, on the Company’s operating results. To qualify as a REIT, the Company must meet a number of organizational and operational requirements. Those qualification tests involve the percentage of income that the Company earns from specified sources, the percentage of the Company’s assets that fall within specified categories, the diversity of the ownership of the Company’s shares, and the percentage of the Company’s taxable income that the Company distributes. The Company is required to distribute annually to its shareholders at least 90% of the Company’s REIT taxable income prior to the deduction for dividends paid. To the extent that the Company distributes less than 100% of its REIT taxable income in any tax year (taking into account any distributions made in a subsequent tax year under Sections 857(b)(9) or 858 of the Code), the Company will pay tax at regular corporate rates on that undistributed portion. Furthermore, the Company will be subject to a 4% nondeductible excise tax on any amount by which distributions the Company pays with respect to any calendar year (including any distributions declared by the last day of the calendar year but paid in the subsequent year) are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. The annual expense is calculated in accordance with applicable tax regulations. Excise tax expense is included in the financial statement line item income tax expense. The Company may form a TRS in the future. A TRS is a corporation in which the Company directly or indirectly owns stock and that jointly with the Company elects to be treated as a TRS under Section 856(l) of the Code. If the TRS owns, directly or indirectly, securities representing 35% or more of the vote or value of a subsidiary corporation, that subsidiary will also be treated as a TRS. A TRS is subject to U.S. federal income tax and state and local income tax, where applicable, as a regular C corporation. Generally, a TRS can engage in activities that, if conducted by us other than through a TRS, could result in the receipt of non-qualified income or the ownership of non-qualified assets. However, several provisions regarding the arrangements between a REIT and its TRSs ensure that a TRS will be subject to an appropriate level of U.S. federal income taxation. For example, the Company will be obligated to pay a 100% penalty tax on some payments that it receives or certain other amounts or on certain expenses deducted by the TRS if the economic arrangements among the Company, its borrowers and/or the TRS are not comparable to similar arrangements among unrelated parties. The income and excise tax provision is included in the line item income tax expense. ASC Topic 740, Income Taxes (“ASC 740”), prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has analyzed its various federal and state filing positions and believes that its income tax filing positions and deductions are well documented and supported as of December 31, 2025. Based on the Company’s evaluation, there is no reserve for any uncertain income tax positions. Accrued interest and penalties, if any, are included within other liabilities in the consolidated balance sheets. The Company files income tax returns in the United States federal jurisdiction as well as various state and local jurisdictions. The filings are subject to normal reviews by tax authorities until the related statute of limitations expires. As of December 31, 2025, tax years since 2024 remain subject to examination by taxing authorities. Earnings per Share The Company calculates basic earnings (loss) per share by dividing net income (loss) allocable to common shareholders for the period by the weighted average shares of Common Stock outstanding for that period after consideration of the earnings (loss) allocated to the Company’s restricted stock, which are participating securities as defined in GAAP. Diluted earnings F-11 Table of Contents (loss) per share takes into effect any dilutive instruments, such as stock options, restricted stock, restricted stock units (“RSUs”) and convertible debt, except when doing so would be anti-dilutive. As of December 31, 2025, there were dilutive instruments relating to restricted shares. See Note 9 included in these consolidated financial statements for the earnings per share calculations. Use of Estimates in the Preparation of Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates. Significant estimates include current expected credit losses. Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 improves the transparency of income tax disclosures related to rate reconciliation and income taxes. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the amendments are effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments should be applied prospectively, however, retrospective application is permitted. The Company adopted ASU 2023-09 effective December 31, 2025 and concluded that the application of this guidance did not have any material impact on its consolidated financial statements. Recent Accounting Pronouncements Pending Adoption In November 2024, the FASB issued ASU 2024-03—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) and in January 2025, the FASB issued ASU 2025-01—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”), which requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The adoption of ASU 2024-03 is not expected to have a material impact on the Company’s consolidated financial statements. In December 2025, the FASB issued ASU 2025-12—Codification Improvements ("ASU 2025-12"), which refines existing guidance to further enhance the interpretation and application of the Codification. ASU 2025-12 is effective for annual and interim reporting periods beginning after December 15, 2026, with early adoption permitted, and applied either prospectively or retrospectively for all prior periods presented. The Adoption of ASU 2025-12 is not expected to have a material impact on the Company's consolidated financial statements. 3. LOANS HELD FOR INVESTMENT AT CARRYING VALUE As of December 31, 2025 and 2024, t he Company’s portfolio included sixteen and nine loans held at carrying value, respectively. The aggregate originated commitment under these loans was approximately $ 420.7 million and $ 190.9 million, resp ectively, and outstanding principal was approximately $ 305.5 million and $ 132.6 million, respectively, as of December 31, 2025 and 2024. During the year ended December 31, 2025, the Company funded approximately $ 224.4 million of new loans and additional principal on existing loans and had approximately $ 51.5 million of principal repayments of loans held at carrying value. As of December 31, 2025 and 2024, approximately 96 % and 79 % , respectively, of the Company’s loans held at carrying value had floating interest rates. As of December 31, 2025, t hese floating benchmark rates included one-month Secured Overnight Financing Rate (“SOFR”) quoted at 3.7 % and subject to a weighted average floor of 4.1 %, and U.S. prime rate quoted at 6.75 % and subject to a weighted average floor of 8.0 % based on outstanding principal. F-12 Table of Contents The following tables summarizes the Company’s loans held at carrying value as of December 31, 2025 and 2024: As of December 31, 2025 Outstanding Principal (1) Original Issue (Discount) Premium Carrying Value (1) Weighted Average Remaining Life (Years) (2) Senior mortgage loans (3)(4) $ 282,678,920 $ ( 2,803,998 ) $ 279,874,922 1.9 Subordinate debt 22,834,265 ( 34,444 ) 22,799,821 2.4 Total loans held at carrying value $ 305,513,185 $ ( 2,838,442 ) $ 302,674,743 1.9 As of December 31, 2024 Outstanding Principal (1) Original Issue (Discount) Premium Carrying Value (1) Weighted Average Remaining Life (Years) (2) Senior mortgage loans (3)(4) $ 109,300,553 $ ( 1,495,512 ) $ 107,805,041 2.6 Subordinate debt 23,255,736 ( 327,147 ) 22,928,589 2.4 Total loans held at carrying value $ 132,556,289 $ ( 1,822,659 ) $ 130,733,630 2.6 (1) The difference between the carrying value and the outstanding principal amount of the loans consists of unaccreted OID or premium and loan origination costs. (2) Weighted average remaining life is calculated based on the carrying value of each respective group of loans as of December 31, 2025 and 2024 . (3) Senior mortgage loans include senior loans that also have a contiguous subordinate loan because as a whole, the expected credit quality of the subordinate loan is more similar to that of a senior loan. (4) If the Company holds both the A-note and B-note, the loan is categorized as a senior mortgage loan. The following table presents changes in loans held at carrying value as of and for the year ended December 31, 2025: Principal Original Issue (Discount) Premium Carrying Value Total loans held at carrying value at December 31, 2024 $ 132,556,289 $ ( 1,822,659 ) $ 130,733,630 New fundings 207,073,953 ( 2,497,278 ) 204,576,675 Interest drawn on loans 17,354,062 — 17,354,062 Accretion of original issue discount and premium, net — 1,481,495 1,481,495 Loan repayments ( 51,516,841 ) — ( 51,516,841 ) PIK interest 45,722 — 45,722 Total loans held at carrying value at December 31, 2025 $ 305,513,185 $ ( 2,838,442 ) $ 302,674,743 F-13 Table of Contents The following table presents changes in loans held at carrying value as of and for the year ended December 31, 2024: Principal Original Issue Discount Carrying Value Total loans held at carrying value at December 31, 2023 $ — $ — $ — New fundings 160,425,359 ( 2,085,761 ) 158,339,598 Interest drawn on loans 5,291,615 — 5,291,615 Accretion of original issue discount and premium, net — 263,102 263,102 Loan repayments ( 33,160,685 ) — ( 33,160,685 ) Total loans held at carrying value at December 31, 2024 $ 132,556,289 $ ( 1,822,659 ) $ 130,733,630 As of December 31, 2025, the Company had one loan held at carrying value on nonaccrual status. In 2024, there were no loans in the Company’s portfolio on nonaccrual status. In December 2025, TCG RE Agent LLC (“TCG RE Agent”) delivered a notice of default on behalf of the lenders with respect to the Company’s senior hospitality loan in San Antonio, Texas (the “San Antonio Loan”) based on certain payment defaults, including failure to make its November interest payment when due, for which the Company determined foreclosure was probable. The San Antonio Loan was placed on nonaccrual status effective October 10, 2025. In connection with the event of default, took control of cash escrows held by TCG RE Agent of $ 0.6 million that were available for capital expenditure reserves to the loan and applied it toward a principal repayment in accordance with the terms of the loan agreement, of which the Company was proportionally allocated $ 0.4 million during the year ended December 31, 2025 . As of December 31, 2025, the Company’s portion of the San Antonio Loan had an unpaid principal balance of approximately $ 26.4 million and amortized cost of $ 26.2 million. Additionally, in anticipation of a potential foreclosure, the Company formed a joint venture entity with the affiliate co-lender on the San Antonio Loan in proportion to their holdings in the San Antonio Loan, with the Company owning 65.0 % of the joint venture. In March 2026, the co-lenders exercised their right to foreclose on the hotel property that was the underlying collateral for the San Antonio Loan. The joint venture acquired the hotel property through a credit bid equal to the aggregate unpaid principal balance of approximately $ 40.6 million. The timing and outcome of the proceedings and the amount of any recovery remain uncertain. F-14 Table of Contents A more detailed listing of the Company’s loans held at carrying value portfolio based on information available as of December 31, 2025 is as follows: Loan Type Location Outstanding Principal (1) Original Issue (Discount) Premium Carrying Value (1) Interest Rate Maturity Date (2) Payment Terms (3) Senior mortgage loans: Residential Austin, TX $ 14,087,288 $ ( 164,303 ) $ 13,922,985 9.75 % (4) 7/3/2027 I/O Hospitality San Antonio, TX 26,379,740 ( 166,833 ) 26,212,907 10.85 % (5) 8/9/2027 I/O Residential PBG, FL 30,980,393 ( 230,209 ) 30,750,184 12.25 % (6) 9/1/2027 I/O Residential PBG, FL 25,033,676 ( 203,125 ) 24,830,551 10.25 % (7) 9/1/2027 I/O Residential Fort Lauderdale, FL 13,623,628 ( 138,462 ) 13,485,166 11.47 % (8) 12/30/2026 I/O Hospitality Austin, TX 32,000,000 ( 255,556 ) 31,744,444 9.50 % (9) 12/11/2027 I/O Residential Aventura, FL 30,750,872 ( 160,439 ) 30,590,433 9.00 % (10) 1/27/2027 I/O Net Leased Tenant New Orleans, LA 10,241,076 ( 305,556 ) 9,935,520 10.10 % (11) 1/30/2028 I/O Residential Dallas, TX 44,822,482 ( 335,833 ) 44,486,649 7.55 % (12) 3/14/2028 I/O Residential Park City, UT 3,269,089 ( 168,990 ) 3,100,099 11.25 % (13) 8/1/2027 I/O Residential Miami, FL 19,094,668 ( 160,417 ) 18,934,251 8.44 % (14) 9/25/2028 I/O Industrial Doral, FL 8,653,728 ( 82,075 ) 8,571,653 9.95 % (15) 10/6/2027 I/O Industrial West Palm Beach, FL 1,770,103 ( 148,867 ) 1,621,236 9.95 % (16) 10/16/2027 I/O Retail Houston, TX 21,972,177 ( 283,333 ) 21,688,844 9.50 % (17) 10/24/2028 I/O Subordinate debt: Residential Miami, FL 10,920,110 ( 79,444 ) 10,840,666 13.25 % (18) 11/15/2027 I/O Residential Miami, FL 11,914,155 45,000 11,959,155 14.50 % (19) 12/13/2028 I/O Total loans held at carrying value $ 305,513,185 $ ( 2,838,442 ) $ 302,674,743 (1) The difference between the carrying value and the outstanding principal amount of the loans consists of unaccreted OID or premium and loan origination costs. (2) Certain loans are subject to contractual extension options and may be subject to performance based or other conditions as stipulated in the loan agreement. Actual maturities may differ from contractual maturities stated herein as certain borrowers may have the right to prepay with or without paying a prepayment penalty. The Company may also extend contractual maturities and amend other terms of the loans in connection with loan modifications. (3) I/O = interest-only, P/I = principal and interest. P/I loans may include interest-only periods for a portion of the loan term. (4) Base interest rate of 5.00 % plus SOFR (SOFR floor of 4.75 %). (5) Base interest rate of 6.35 % plus SOFR (SOFR floor of 4.50 %). Effective October 10, 2025, the Company placed the borrower on nonaccrual status. (6) Base interest rate of 8.25 % plus SOFR (SOFR floor of 4.00 %). (7) Base interest rate of 6.25 % plus SOFR (SOFR floor of 4.00 %). (8) Cash interest rate represents a blended rate of differing cash interest rates applicable to each of the A-Notes and B-Notes to which the Company is a lender under the credit agreements. The A-Notes bear interest at a base interest rate of 4.75 % plus SOFR (SOFR floor of 4.75 %) and the B-Notes bear interest at a base interest rate of 11.00 % plus SOFR (SOFR floor of 4.75 %). (9) Base interest rate of 5.50 % plus SOFR (SOFR floor of 4.00 %). (10) Base interest rate of 5.00 % plus SOFR (SOFR floor of 4.00 %). (11) Base interest rate of 5.60 % plus SOFR (SOFR floor of 4.50 %). (12) Base interest rate of 3.65 % plus SOFR (SOFR floor of 3.90 %). (13) Base interest rate of 3.25 % plus U.S. prime rate (U.S. prime floor of 8.00 %). (14) Base interest rate of 4.75 % plus SOFR (SOFR floor of 3.50 %). (15) Base interest rate of 6.20 % plus SOFR (SOFR floor of 3.75 %). (16) Base interest rate of 6.20 % plus SOFR (SOFR floor of 3.75 %). (17) Base interest rate of 5.75 % plus SOFR (SOFR floor of 3.75 %). (18) Base interest rate of 13.25 %. (19) Base interest rate of 9.50 % plus SOFR (SOFR floor of 4.00 %) and PIK interest rate of 1.00 %. F-15 Table of Contents 4. CURRENT EXPECTED CREDIT LOSSES As of December 31, 2025 and 2024, the Company’s CECL Reserve for its loans held at carrying value was approximately $ 2.1 million and $ 40.2 thousand, respectively, or 0.68 % and 0.03 %, respectively, of the Company’s total loans held at carrying value of approximately $ 302.7 million and $ 130.7 million, respectively, and is bifurcated between the current expected credit loss reserve (contra-asset) related to outstanding balances on loans held at carrying value of approximately $ 1.9 million and $ 21.8 thousand, respectively, and a liability for unfunded commitments of approximately $ 0.2 million and $ 18.4 thousand, respectively. The liability was based on the unfunded portion of the loan commitment over the full contractual period over which the Company is exposed to credit risk through a current obligation to extend credit. Management considered the likelihood that funding will occur and, if funded, the expected credit loss on the funded portion when determining the amount to allocate to its CECL Reserve. Activity related to the CECL Reserve for outstanding balances and unfunded commitments on the Company’s loans held at carrying value as of and for the years ended December 31, 2025 and 2024 was as follows: Outstanding (1) Unfunded (2) Total Balance at December 31, 2024 $ 21,782 $ 18,398 $ 40,180 Provision for current expected credit losses 1,869,388 159,668 2,029,056 Write-offs — — — Recoveries — — — Balance at December 31, 2025 $ 1,891,170 $ 178,066 $ 2,069,236 Outstanding (1) Unfunded (2) Total Balance at December 31, 2023 $ — $ — $ — Provision for current expected credit losses 21,782 18,398 40,180 Write-offs — — — Recoveries — — — Balance at December 31, 2024 $ 21,782 $ 18,398 $ 40,180 (1) As of December 31, 2025 and 2024, the CECL Reserve related to outstanding balances on loans held at carrying value is recorded within current expected credit loss reserve in the Company’s consolidated balance sheets. (2) As of December 31, 2025 and 2024, the CECL Reserve related to unfunded commitments on loans held at carrying value is recorded within current expected credit loss reserve as a liability in the Company’s consolidated balance sheets. The Company continuously evaluates the credit quality of each loan by assessing the risk factors of each loan and assigning a risk rating based on a variety of factors. Such factors may include property type, geographic and local market dynamics, physical condition, projected cash flow, loan structure and exit plan, loan-to-value ratio, fixed charge coverage ratio, project sponsorship, and other factors deemed necessary by the Company. Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows: Rating Definition 1 Very Low Risk — Investment exceeds performance expectations. Trends and risk factors since time of investment are favorable. 2 Low Risk — Investment performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable. 3 Medium Risk — Performing investments requiring closer monitoring. Trends and risk factors show some deterioration. 4 High Risk/ Potential for Loss — Investment underperforming with the potential of some interest loss. Trends and risk factors are negative. 5 Impaired/ Loss Likely — Investment underperforming with expected loss of interest, and full recovery of principal is unlikely. The risk ratings are primarily based on historical data as well as taking into account future economic conditions. F-16 Table of Contents As of December 31, 2025, the carrying value, excluding the CECL Reserve, of the Company’s loans held at carrying value within each risk rating by year of origination is as follows: Risk Rating: 2025 2024 Total 1 $ — $ — $ — 2 150,887,840 125,573,996 276,461,836 3 — — — 4 — — — 5 — 26,212,907 26,212,907 Total $ 150,887,840 $ 151,786,903 $ 302,674,743 5. INTEREST RECEIVABLE The following table summarizes the interest receivable balance for the Company as of December 31, 2025 and 2024: As of December 31, 2025 2024 Interest receivable $ 2,251,700 $ 1,118,927 Unused fees receivable 2,203 11,821 PIK receivable 7,037 — Other fees receivable 3,193 7,813 Total interest receivable $ 2,264,133 $ 1,138,561 6. DEBT Revolving Credit Facility On November 6, 2024, the Company entered into the Loan and Security Agreement (as amended, restated or otherwise modified from time to time, the “Revolving Credit Agreement”) by and among the Company, as borrower, the lenders party thereto, and East West Bank, as administrative agent, joint lead arranger, joint book runner, co-syndication agent and co-documentation agent (“East West Bank”). The Revolving Credit Agreement provides for a senior secured revolving credit facility (the “Revolving Credit Facility”) that contains initial aggregate commitments of $ 50.0 million from one or more FDIC-insured banking institutions, which may be borrowed, repaid and redrawn, subject to a borrowing base based on eligible loan obligations held by the Company and subject to the satisfaction of other conditions provided under the Revolving Credit Agreement. During the year ended December 31, 2025 , the Company entered into a series of amendments to the Revolving Credit Facility that, among other things, increased the aggregate commitment from $ 50.0 million to $ 140.0 million. Pursuant to the terms of the Revolving Credit Agreement, the amount of total commitments may be increased to up to $ 200.0 million in aggregate, subject to available borrowing base and lenders’ willingness to provide additional commitments. The Revolving Credit Facility has a maturity date of November 8, 2027. Interest is payable on the Revolving Credit Facility in cash in arrears at the rate per annum of SOFR plus 2.75 %, with a SOFR floor of 2.63 %; provided, however, that the interest rate will increase by an additional 0.25 % during any Increase Rate Month (as defined in the Revolving Credit Agreement). The Company is required to pay certain fees to the agent and the lenders under the Revolving Credit Agreement, including a $ 75.0 thousand agent fee payable to the agent and a 0.25 % per annum loan fee payable ratably to the lenders, in each case, payable on the closing date and on the annual anniversary thereafter. Commencing on the six-month anniversary of the closing date, the Revolving Credit Facility has an unused line fee of 0.25 % per annum, payable semi-annually in arrears. Based on the terms of the Revolving Credit Agreement, the unused line fee is waived if our average revolver usage exceeds the minimum amount required per the Revolving Credit Agreement. During the years ended December 31, 2025 and 2024, the Company incurred an unused line fee of approximately $ 48.7 thousand and zero , respectively . In connection with the Revolving Credit Agreement and related amendments, the Company incurred certain closing costs of F-17 Table of Contents approximately $ 0.5 million, which were included in prepaid expenses and other assets on the Company’s consolidated balance sheets and amortized over the life of the Revolving Credit Facility . The Revolving Credit Facility is guaranteed by certain material subsidiaries of the Company and is secured by substantially all assets of the Company; provided that upon the meeting of certain conditions, the Revolving Credit Facility will be secured only by certain assets of the Company comprising of or relating to loan obligations designed for inclusion in the borrowing base. In addition, the Company is subject to various financial and other covenants, including a liquidity and debt service coverage ratio covenant. As amended, the Revolving Credit Facility requires us to, among other things: (i) maintain liquidity equal to the greater of (A) $ 5 million and (B) an amount equal to 10 % of the outstanding obligations thereunder so long as we maintain at least $ 5 million in qualified cash (ii) maintain a quarterly debt service coverage ratio of at least 1.50 to 1.0 and (iii) maintain a leverage ratio of not more than 3.25 x measured as of the end of each fiscal quarter. As of December 31, 2025 and 2024, outstanding borrowings under the Revolving Credit Facility were $ 102.3 million and $ 123.8 million, respectively, and $ 37.7 million and $ 1.2 million were available for borrowing as of December 31, 2025 and 2024, respectively. As of December 31, 2025 and 2024, the interest rate on the Company’s borrowings under the Revolving Credit Facility was 6.59 % and 7.28 %, respectively. SRTF Credit Facility On September 26, 2024, the Company entered into an unsecured revolving credit agreement (the “Credit Agreement”), by and between the Company, as borrower, and SRT Finance LLC, as agent and lender. SRT Finance LLC is indirectly owned by Leonard M. Tannenbaum, Executive Chairman of the Company’s Board of Directors (the “Board of Directors”) and one of the Company’s officers, and Robyn Tannenbaum, President of the Company, along with their family members and associated family trusts. The Credit Agreement provides for an unsecured revolving credit facility (the “SRTF Revolving Credit Facility”) with a $ 50.0 million commitment, which may be borrowed, repaid and redrawn, subject to a draw fee and the other conditions provided in the Credit Agreement. Interest is payable on the SRTF Revolving Credit Facility at 1-month SOFR (subject to a 3.0 % floor) plus a margin of 2.75 %, with a maturity date of December 31, 2025. The Company did not incur any fees or costs related to the origination of the SRTF Revolving Credit Facility, and the SRTF Revolving Credit Facility did not have any unused fees. On November 6, 2024, in conjunction with the entry by the Company into the Revolving Credit Facility, the Company terminated the Credit Agreement. Upon execution of the Revolving Credit Facility, the lenders’ commitments under the Credit Agreement were terminated and the liability of the Company and its subsidiaries with respect to their obligations under the Credit Agreement was discharged. On December 9, 2024, the Company entered into a new unsecured revolving credit agreement (the “SRTF Credit Agreement”), by and among the Company, as borrower, the lenders party thereto from time to time, and SRT Finance LLC, as agent and lender. SRT Finance LLC continues to be indirectly owned by Mr. Tannenbaum and Mrs. Tannenbaum, along with their family members and associated family trusts. The SRTF Credit Agreement provides for an unsecured revolving credit facility (the “SRTF Credit Facility”) with a $ 75.0 million commitment, which may be borrowed, repaid and redrawn, subject to a draw fee and the other conditions provided in the SRTF Credit Agreement. Interest is payable on the SRTF Credit Facility at a rate per annum equal to 8.00 %. The SRTF Credit Facility matures on the earlier of (i) May 31, 2028 and (ii) the date of the closing of any Refinancing Indebtedness (as defined in the SRTF Credit Agreement) with an aggregate principal amount equal to or greater than $ 75.0 million. As amended, commencing on January 1, 2026, the Company will be required to pay an annual fee equal to 1.00 % of the aggregate commitments ratably to the lenders, payable on the first business day of each quarter; provided that the fee due and payable on January 3, 2028 will be prorated on the basis of a year of 360 days for the actual number of days elapsed from and including January 1, 2028 until and excluding May 31, 2028. In connection with the SRTF Credit Agreement and related amendments, the Company incurred certain closing costs of approximately $ 25.5 thousand, which were included in prepaid expenses and other assets on the Company’s consolidated balance sheets and amortized over the life of the SRTF Revolving Credit Facility. As of December 31, 2025 and 2024, outstanding borrowings under the SRTF Credit Facility were $ 19.8 million and $ 75.0 million, respectively, and $ 55.2 million and zero were available for borrowing as of December 31, 2025 and 2024, respectively. F-18 Table of Contents The following tables reflect a summary of interest expense incurred during the years ended December 31, 2025 and 2024: Year ended December 31, 2025 Revolving Credit Facility SRTF Revolving Credit Facility Total Borrowings Interest expense $ 3,949,093 $ 326,194 $ 4,275,287 Unused fee expense 48,708 — 48,708 Amortization of deferred financing costs 472,055 5,934 477,989 Total interest expense $ 4,469,856 $ 332,128 $ 4,801,984 Year ended December 31, 2024 Revolving Credit Facility SRTF Revolving Credit Facility Total Borrowings Interest expense $ 97,283 $ 77,530 $ 174,813 Unused fee expense — — — Amortization of deferred financing costs 41,092 363 41,455 Total interest expense $ 138,375 $ 77,893 $ 216,268 7. COMMITMENTS AND CONTINGENCIES As of December 31, 2025 and 2024, the Company had the following commitments to fund various investments: As of December 31, 2025 2024 Total loan commitments $ 420,707,524 $ 190,921,475 Less: drawn commitments ( 305,440,623 ) ( 132,556,289 ) Total undrawn commitments $ 115,266,901 $ 58,365,186 The Company from time to time may be a party to litigation in the normal course of business. The Company investigates these claims as they arise. If the potential loss from any claim or legal claim is considered probable and the amount can be estimated, the Company accrues a liability for the estimated loss. As of December 31, 2025, the Company was not aware of any legal claims that could materially impact its business, financial condition or results of operations. 8. SHAREHOLDERS’ EQUITY Corporate Conversion On February 20, 2024, the Company completed a corporate conversion, converting from a Delaware limited liability company to a Maryland corporation. Pursuant to the certificate of incorporation effected in connection with the corporate conversion, the Company’s authorized capital stock consists of 50,000,000 shares of voting Common Stock and 10,000 shares of Preferred Stock (defined below), par value $ 0.01 per share. Preferred Stock As of December 31, 2025 and 2024, the Company was authorized to issue up to 10,000 shares of Preferred Stock, par value $ 0.01 per share (the “Preferred Stock”), respectively, of which none have been issued. The Board of Directors has the authority, without action by our shareholders, to issue up to 10,000 shares of Preferred Stock in one or more series or classes and to designate the rights, preferences and privileges of each series or class, which may be greater than the rights F-19 Table of Contents of Common Stock. There were no shares of Preferred Stock designated or outstanding as of December 31, 2025 and 2024, respectively. Common Stock As of December 31, 2025 and 2024, the Company was authorized to issue up to 50,000,000 shares of Common Stock, respectively, and issued 13,420,986 and 7,004,676 shares of Common Stock, respectively. Shelf Registration Statement On August 1, 2025, the Company filed a shelf registration statement on Form S-3 (File No. 333-289188) (the “Shelf Registration Statement”), which was declared effective on August 6, 2025. Under the Shelf Registration Statement, the Company may, from time to time, issue and sell up to $ 500.0 million of the Company’s common stock, preferred stock, debt securities, warrants and rights (including as part of a unit) to purchase shares of the Company’s common stock or preferred stock. On January 29, 2025, the Company completed a registered public offering of 5,750,000 shares of common stock at a public offering price of $ 12.00 per share (the “January 2025 Offering”), of which 1,000,000 shares of common stock were sold to Leonard M. Tannenbaum, the Company’s Executive Chairman, at the public offering price. The Company received net proceeds from the January 2025 Offering of $ 65.3 million, net of underwriting discounts of $ 3.7 million. In connection with the January 2025 Offering, the underwriters were granted an over-allotment option to purchase up to an additional 862,500 shares of the Company’s common stock. On January 31, 2025, the underwriters partially exercised the over-allotment option with respect to 650,000 shares of common stock and the Company received additional net proceeds of $ 7.3 million, net of underwriting discounts of $ 0.5 million. The Company incurred approximately $ 1.8 million of expenses in connection with the offering. After giving effect to the partial exercise of the over-allotment option, the total number of shares sold by the Company in the public offering was 6,400,000 shares and total gross proceeds, before deducting underwriting discounts and commissions, and other offering expenses payable by the Company, were approximately $ 76.8 million. The net proceeds to the Company totaled approximately $ 70.8 million . At-the-Market Offering Program (“ATM Program”) On August 13, 2025, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) by and among the Company, SUNS Manager and Raymond James & Associates, Inc. (the “Sales Agent”) under which the Company may, from time to time, offer and sell shares of common stock, having an aggregate offering price of up to $ 50.0 million. Under the terms of the Equity Distribution Agreement, the Company has agreed to pay the Sales Agents a commission of up to 2.0 % of the gross sales price of common stock sold through the Sales Agents. Sales of common stock, if any, may be made in transactions that are deemed to be “at-the-market” offerings, as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended (the “Securities Act”). There were no shares issued under the ATM Program during the year ended December 31, 2025. Dividend Reinvestment Plan On September 3, 2025, the Company established a dividend reinvestment plan (“DRIP”). The DRIP allows shareholders to reinvest all or a portion of their cash dividends in additional shares of the Company’s common stock (which shares, at the Company’s option, are either newly issued directly from the Company or purchased by the plan administrator in the open market). The Company may issue up to 1,000,000 shares of common stock under the DRIP. There were no shares issued under the DRIP during the year ended December 31, 2025. Spin-Off On July 1, 2024, the Board of Directors approved a forward stock split of shares of the Company’s Common Stock, at a ratio of 68,890.32 -for-one (to be effected in the form of a stock dividend for purposes of the Maryland General Corporation Law), pursuant to which 68,890.32 additional shares of the Company’s Common Stock were issued for each outstanding share of the Company’s Common Stock (the “Forward Stock Split”), payable prior to the consummation of the Spin-Off. The Forward Stock Split took effect immediately prior to the distribution of the shares of the Company’s common stock to the shareholders of AFC common stock. As a result of the Forward Stock Split, the number of outstanding shares of the Company’s Common Stock increased to 6,889,032 shares outstanding as of July 9, 2024, of which 88,685 were restricted shares at the time of Spin-Off. F-20 Table of Contents The Spin-Off was effected by the transfer of AFC’s CRE portfolio from AFC to SUNS and the distribution of all of the outstanding shares of Common Stock to all of AFC’s shareholders of record as of the close of business on July 8, 2024. AFC’s shareholders of record as of the Record Date received one share of Common Stock for every three shares of AFC common stock held as of the close of business on July 8, 2024, the Record Date for the distribution, as well as a cash payment in lieu of any fractional shares. The Spin-Off was completed on July 9, 2024. Immediately after the Spin-Off, the Company was no longer a wholly owned subsidiary of AFC. On July 9, 2024, AFC non-vested restricted stock awards that were outstanding on the Distribution Date were converted into AFC restricted stock awards and SUNS restricted stock awards. Upon completion of the Spin-Off, the AFC restricted stock awards were converted into 88,685 shares of SUNS restricted stock. The vesting schedule remains the same as the original awards. Stock Incentive Plan The Company has established the 2024 Stock Incentive Plan (the “2024 Plan”). The 2024 Plan authorizes stock options, stock appreciation rights, restricted stock, stock bonuses, stock units and other forms of awards granted or denominated in the Company’s Common Stock or units of Common Stock. The 2024 Plan retains flexibility to offer competitive incentives and to tailor benefits to specific needs and circumstances. Any award may be structured to be paid or settled in cash. The Company has granted, and currently intends to continue to grant, restricted stock awards to participants in the 2024 Plan, but it may also grant any other type of award available under the 2024 Plan in the future. Persons eligible to receive awards under the 2024 Plan include officers or employees of the Company or any of its subsidiaries, directors of the Company, employees of the Manager and certain directors, consultants and other service providers to the Company or any of its subsidiaries. During the year ended December 31, 2025 , the Company’s Board of Directors approved grants of restricted stock to the Company’s directors and certain officers, as well as certain employees of the Manager or its affiliates, with an aggregate of 19,625 shares of restricted stock granted to such eligible persons. The restricted stock awards granted during the year ended December 31, 2025 under the 2024 Plan vest over a three-year period, with approximately 33 % vesting on each of the first, second and third anniversaries of the vesting commencement date. During the year ended December 31, 2024, the Company’s Board of Directors approved grants of restricted stock to the Company’s directors and certain officers, as well as certain employees of the Manager or its affiliates, with an aggregate of 115,644 shares of restricted stock granted to such eligible persons. The restricted stock awards granted during the year ended December 31, 2024 under the 2024 Plan contain vesting periods that vary from one-year vesting to vesting over a three-year period, with approximately 33% vesting on each of the first, second and third anniversaries of the vesting commencement date. As of December 31, 2025 , there were 131,954 shares of restricted stock granted under the 2024 Plan. As of December 31, 2025 , the maximum number of shares of the Company’s Common Stock that may be delivered pursuant to awards under the 2024 Plan (the “Share Limit”) equaled 1,191,122 shares, of which 1,059,168 shares remained available for future issuance under the 2024 Plan. At the discretion of the Board of Directors, the Company waived the evergreen provision in connection with the Minimum Annual Increase (as defined in the 2024 Plan) under the 2024 Plan for the 2024 fiscal year. In January 2025, the Company completed an offering of the Company’s Common Stock and pursuant to the evergreen provision in the 2024 Plan with respect to the public offerings, the total number of shares reserved for issuance under the 2024 Plan automatically increased by ten percent of the total number of shares of Common Stock sold by the Company in the January 2025 Offering, which equaled 640,000 shares. Shares that are subject to or underlie awards that expire or, for any reason, are cancelled, terminated, forfeited, fail to vest or are not paid or delivered under the 2024 Plan will not be counted against the Share Limit and will again be available for subsequent awards under the 2024 Plan. F-21 Table of Contents Stock Compensation The following table summarize s the stock-based compensation expense incurred by the Company for the years ended December 31, 2025 and 2024: Years ended December 31, 2025 2024 Stock-based compensation $ 1,019,168 $ 338,404 Restricted Stock The following table summarizes restricted stock (i) converted upon Spin-Off, (ii) granted, (iii) vested and (iv) forfeited for the Company’s directors and officers and employees of the Manager as of December 31, 2025 and 2024: As of December 31, 2025 2024 Converted upon Spin-Off 88,685 88,685 Granted 135,269 115,644 Vested ( 76,350 ) ( 805 ) Forfeited ( 3,315 ) — Balance 144,289 203,524 The fair value of the Company’s restricted stock awards is based on the Company’s stock price on the date of grant. The following tables summarize the restricted stock activity as of and during the year ended December 31, 2025: Number of shares of restricted stock Weighted-average grant date fair value Balance as of December 31, 2024 203,524 $ 13.16 Granted 19,625 11.78 Vested ( 75,545 ) 13.33 Forfeited ( 3,315 ) 13.04 Balance as of December 31, 2025 144,289 $ 12.88 During the year ended December 31, 2024, 115,644 shares of restricted stock were granted with a weighted-average grant date fair value of $ 13.34 . During the year ended December 31, 2024, 805 shares of restricted stock vested with a weighted-average grant date fair value of $ 21.64 . The total fair value of shares vested during the years ended December 31, 2025 and 2024, was approximately $ 0.9 million and $ 11.8 thousand, respectively. As of December 31, 2025 , there was approximately $ 1.3 million of total unrecognized compensation cost related to non-vested restricted stock. That cost is expected to be recognized over a weighted-average period of 1.71 years. F-22 Table of Contents 9. EARNINGS PER SHARE The following information sets forth the computations of basic and diluted earnings per common share for the years ended December 31, 2025 and 2024: Years ended December 31, 2025 2024 Net income $ 12,142,409 $ 6,868,421 Dividends paid on unvested restricted stock ( 248,458 ) ( 26,091 ) Net income attributable to common shareholders 11,893,951 6,842,330 Divided by: Basic weighted average shares of common stock outstanding 12,742,894 6,800,841 Weighted average unvested restricted stock 31,434 34,956 Diluted weighted average shares of common stock outstanding 12,774,328 6,835,797 Basic earnings per common share $ 0.93 $ 1.01 Diluted earnings per common share $ 0.93 $ 1.00 Diluted earnings per common share was computed using the treasury stock method for restricted stock. Diluted earnings per common share excluded 63,489 and 35,447 weighted average shares of unvested restricted stock due to anti-dilutive effect for the years ended December 31, 2025 and 2024, respectively . 10. INCOME TAX Prior to the Spin-Off, the Company was a wholly-owned subsidiary of AFC and was a disregarded entity for tax purposes. As such, the Company did not file a tax return. The Company’s entire share of taxable income or loss was previously included in the tax return of AFC. The Company elected to be taxed as a REIT for U.S. federal income tax purposes, commencing with the taxable year ending December 31, 2024. The Company believes that we have been organized in conformity with the requirements for qualification and taxation as a REIT under the U.S. federal income tax laws, and that our method of operation enables us to satisfy the requirements for qualification and taxation as a REIT under the U.S. federal income tax laws for such taxable year and thereafter. So long as the Company qualifies for taxation as a REIT, the Company generally will not be subject to U.S. federal income tax on the portion of our taxable income or capital gain that is distributed to shareholders annually. The Company had no income tax provision for the years ended December 31, 2025 and 2024. For the years ended December 31, 2025 and 2024, the Company incurred no expense for U.S. federal excise tax. Excise tax represents a 4 % tax on the sum of a portion of the Company’s ordinary income and net capital gains not distributed during the period. If it is determined that an excise tax liability exists for the current period, the Company will accrue excise tax on estimated excess taxable income as such taxable income is earned. The expense is calculated in accordance with applicable tax regulations. The Company does not have any unrecognized tax benefits and the Company does not expect that to change in the next 12 months. As of December 31, 2025, tax years 2024-2025 remain subject to examination by taxing authorities. 11. FAIR VALUE Fair Value of Financial Instruments GAAP requires disclosure of fair value information about financial instruments, whether or not recognized at fair value in the balance sheets, for which it is practicable to estimate that value. F-23 Table of Contents The following table details the carrying value and fair value of the Company’s financial instruments not recognized at fair value in the consolidated balance sheets as of December 31, 2025 : As of December 31, 2025 Carrying Value Fair Value Financial assets: Cash and cash equivalents $ 6,445,328 $ 6,445,328 Loans held for investment, net $ 302,674,743 $ 302,338,242 Cash and cash equivalents have a carrying value which approximates their fair value due to the short-term nature of these instruments. The Company categorizes the fair value measurement of these assets as Level 1. The Company’s loans held for investment are measured using unobservable inputs, or Level 3 inputs. 12. RELATED PARTY TRANSACTIONS Management Agreement On February 22, 2024, the Company and the Manager, entered into a management agreement (the “Management Agreement”), effective upon the listing of the Company’s Common Stock. Following the completion of the Spin-Off on July 9, 2024, the Company became managed by its Board of Directors and the Company’s executive officers and by SUNS Manager, as provided for under our Management Agreement. Pursuant to the Management Agreement, the Manager manages the loans and day-to-day operations of the Company, subject at all times to the further terms and conditions set forth in the Management Agreement and such further limitations or parameters as may be imposed from time to time by the Board of Directors. The Manager receives base management fees (the “Base Management Fees”) that are calculated and payable quarterly in arrears, in an amount equal to 0.375 % of the Company’s Equity (as defined in the Management Agreement), subject to certain adjustments, less 50 % of the aggregate amount of any other fees (“Outside Fees”), including any agency fees relating to the Company’s loans, but excluding the Incentive Compensation (as defined below) and any diligence fees paid to and earned by the Manager and paid by third parties in connection with the Manager’s due diligence of potential loans. Base Management Fees incurred for the years ended December 31, 2025 and 2024 were approximately $ 2.1 million and $ 0.8 million, respectively. Refer to the fee waiver below. In addition to the Base Management Fees, the Manager is entitled to receive incentive compensation (the “Incentive Compensation” or “Incentive Fees”) with respect to each fiscal quarter (or portion thereof that the Management Agreement is in effect) based upon the Company’s achievement of targeted levels of Core Earnings. “Core Earnings” is defined in the Management Agreement as, for a given period, the net income (loss) for such period, computed in accordance with GAAP, excluding (i) non-cash equity compensation expense, (ii) Incentive Compensation, (iii) depreciation and amortization, (iv) any unrealized gains or losses or other non-cash items that are included in net income for the applicable reporting period, regardless of whether such items are included in other comprehensive income or loss, or in net income and (v) one-time events pursuant to changes in GAAP and certain non-cash charges, in each case after discussions between the Manager and the Company’s independent directors and approval by a majority of the independent directors. Incentive Fees incurred for the year ended December 31, 2025 were approximately $ 0.4 million. There were no Incentive Fees incurred for the year ended December 31, 2024. Refer to the fee waiver below. Fee Waiver From time to time, the Manager may waive fees it would otherwise be entitled to under the terms of the Management Agreement. The Manager agreed to waive (i) the inclusion of the net proceeds from the January 2025 Offering in the Company’s Equity for purposes of calculating the management fee until the earlier of (a) December 31, 2025 and (b) the quarter in which the total amount of the net proceeds of the January 2025 Offering have been utilized to fund loans in our portfolio and (ii) an additional $ 1.0 million in fees. For the year ended December 31, 2025, Base Management Fees waived were $ 0.6 million and Incentive Fees waived were $ 0.5 million . F-24 Table of Contents Administrative Services Agreement In July 2024, SUNS Manager entered into the Administrative Services Agreement with TCG Services LLC, an affiliate of SUNS Manager, Mr. Tannenbaum and Mrs. Tannenbaum. The Administrative Services Agreement sets forth the terms on which TCG Services LLC will provide SUNS certain administrative services, including providing personnel, office facilities, information technology and other equipment and legal, accounting, human resources, clerical, bookkeeping and record keeping services at such facilities as well as other services. Services Agreement In July 2024, SUNS Manager entered into a Services Agreement with SRT Group LLC, an affiliate of SUNS Manager and certain officers. The Services Agreement sets forth the terms on which SRT Group LLC will provide SUNS its investment personnel. The Company is required to pay all of its allocable costs and expenses and reimburse the Manager or its affiliates for such expenses paid or incurred on behalf of the Company by the Manager or its affiliates, excepting only those expenses that are specifically the responsibility of the Manager pursuant to the Management Agreement. Until the completion of the Spin-Off, there were no Base Management Fees or Incentive Fees incurred by the Company. The following table summarizes the related party costs incurred by the Company for the years ended December 31, 2025 and 2024: Years ended December 31, 2025 2024 Affiliate costs Base management fees $ 2,079,792 $ 815,301 Incentive fees earned 374,338 — General and administrative expenses reimbursable to Manager 2,412,177 1,072,527 Professional fees reimbursable to Manager 44,671 13,106 Total $ 4,910,978 $ 1,900,934 Amounts payable to the Manager as of December 31, 2025 and 2024 were approximately $ 1.0 million and $ 1.1 million , respectively, and are recorded within Accrued management and incentive fees and Accrued direct administrative expenses in the Company’s consolidated Balance Sheets. The Manager is beneficially owned by certain officers as of the date of this Annual Report on Form 10-K : 37 %, by Mr. Tannenbaum, the Company’s Executive Chairman, 8 % by Mrs. Tannenbaum, the Company’s President, 42 % by other Tannenbaum family members and trusts, 7 % by Mr. Sedrish, the Company’s Chief Executive Officer, 2 % by Brandon Hetzel, the Company’s Chief Financial Officer, and 1 % by Gabriel Katz, the Company’s Chief Legal Officer. Investments in Loans From time to time, the Company may co-invest with other investment vehicles managed by the SUNS Manager or its affiliates, including by means of splitting loans, participating in loans or other means of syndicating loans. The Company is not obligated to provide, nor has it provided, any financial support to the other managed investment vehicles. As such, the Company’s risk is limited to the carrying value of its investment in any such loan. Additionally, SUNS Manager or its affiliates, including TCG RE Agent, may from time to time serve as administrative and collateral agents to the lenders under the loans in the Company’s portfolio. As of December 31, 2025, there were 16 co-invested loans held by the Company and affiliates of the Company. Additionally, in connection with the Company’s exercise of its right to foreclose on the hotel property that was the underlying collateral for the San Antonio Loan, in March 2026, the Company formed a joint venture entity with the affiliate co-lender on the San Antonio Loan to acquire ownership of the San Antonio property proportional to their respective holdings in the San Antonio Loan, with the Company owning 65.0 % of the joint venture. Refer to Note 3 for more information. F-25 Table of Contents Unsecured Revolving Credit Facility with Affiliate The Company entered the Revolving Credit Facility with SRT Finance LLC, an affiliate of the Company and Mr. and Mrs. Tannenbaum. Refer to Note 6 for more information. 13. DIVIDENDS AND DISTRIBUTIONS The following table summarizes the Company’s dividends declared during the years ended December 31, 2025 and 2024: Declaration Date Record Date Payment Date Per Common Share Distribution Amount Taxable Ordinary Income Qualified Dividends Return of Capital Section 199A Dividends 8/14/2024 9/30/2024 10/15/2024 $ 0.21 $ 0.21 $ — $ — $ 0.21 8/14/2024 12/31/2024 1/15/2025 0.42 0.42 — — 0.42 2024 Total cash dividend $ 0.63 $ 0.63 $ — $ — $ 0.63 3/4/2025 3/31/2025 4/15/2025 $ 0.30 $ 0.30 $ — $ — $ 0.30 6/13/2025 6/30/2025 7/15/2025 0.30 0.30 — — 0.30 9/15/2025 9/30/2025 10/15/2025 0.30 0.30 — — 0.30 12/15/2025 12/31/2025 1/15/2026 0.30 0.30 — — 0.30 2025 Total cash dividend $ 1.20 $ 1.20 $ — $ — $ 1.20 14. REPORTABLE SEGMENTS ASC 280, Segment Reporting, establishes standards for reporting financial and descriptive information about an enterprise’s reportable segments. The Company is an institutional lender that provides debt capital solutions to CRE markets in the Southern United States , with a primary focus on opportunities in Arizona, Florida, Georgia, Nevada, North Carolina, South Carolina, Tennessee and Texas. The Company generates revenue from originating and investing in secured CRE loans and providing capital to high-quality borrowers and sponsors with transitional business plans collateralized by CRE assets with opportunities for near-term value creation, as well as recapitalization opportunities. The accounting policies of the institutional lending segment are the same as those described in the summary of significant accounting policies. The presentation of financial results as one reportable segment is consistent with the way the Company operates its business and is consistent with the manner in which the Company’s Chief Operating Decision Maker (“CODM”), the Company’s Chief Executive Officer, evaluates performance and makes resource and operating decisions for the business. The Company has no operations outside of the United States. The Company’s portfolio exhibits similar economic characteristics, similar yields and is operated using consistent business strategies. The Company operates as one operating segment and has one reportable operating segment for activities related to institutional lending. The CODM assesses performance and evaluates the allocation of resources of the Company on a consolidated basis, based on the Company’s net income, which is reported on the Company’s consolidated statements of operations. The CODM is regularly provided with only the consolidated expenses, as noted on the consolidated statement of operations. Significant segment expenses are listed on the accompanying consolidated statement of operations. The measure of segment assets is reported on the consolidated balance sheets as total assets. The CODM uses net income to evaluate income generated from segment assets and in deciding the amount of dividends to be distributed, as well as using net income as a basis for evaluating lender terms for CRE loans with borrowers and sponsors. Interest income earned on the Company’s portfolio was concentrated with four borrowers each comprising more than 10% of consolidated interest income for an aggregate amount of $ 15.3 million, or 58 %, of consolidated interest income during the year ended December 31, 2025. Interest income earned on the Company’s portfolio was concentrated with four borrowers each comprising more than 10% of consolidated interest income for an aggregate amount of $ 9.3 million, or 86 %, of consolidated interest income during the year ended December 31, 2024. F-26 Table of Contents 15. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date the consolidated financial statements were available to be issued. There were no material subsequent events, other than those described below, that required disclosure in these consolidated financial statements. In January 2026, the Company and an affiliated co-investor entered into and exited a $ 21.6 million senior bridge loan to finance the acquisition of a ranch located in Colorado. The Company committed a total of $ 14.0 million, and an affiliated co-investor committed the remaining $ 7.6 million, funding $ 14.0 million and $ 7.6 million, respectively, upon closing. The senior bridge loan was issued at a discount of 3.0 % and matures in July 2026. The senior bridge loan was fully paid off four days after closing in January 2026. In December 2025, TCG RE Agent delivered a notice of default on behalf of the lenders with respect to the Company’s senior hospitality loan in San Antonio, Texas (the “San Antonio Loan”) based on certain payment defaults, including failure to make its November interest payment when due, for which we determined foreclosure was probable. The San Antonio Loan was placed on nonaccrual status effective October 10, 2025. In connection with the event of default, TCG RE Agent took control of cash escrows held by TCG RE Agent of $ 0.6 million that were available for capital expenditure reserves to the loan and applied it toward a principal repayment in accordance with the terms of the loan agreement, of which the Company was proportionally allocated $ 0.4 million during the year ended December 31, 2025. As of December 31, 2025, the Company’s portion of the San Antonio Loan had an unpaid principal balance of approximately $ 26.4 million and amortized cost of $ 26.2 million. Additionally, in anticipation of a potential foreclosure, the Company formed a joint venture entity with the affiliate co-lender on the San Antonio Loan in proportion to their holdings in the San Antonio Loan, with the Company owning 65.0 % of the joint venture. In March 2026, the co-lenders exercised their right to foreclose on the hotel property that was the underlying collateral for the San Antonio Loan. The joint venture acquired the hotel property through a credit bid equal to the aggregate unpaid principal balance of approximately $ 40.6 million. The timing and outcome of the proceedings and the amount of any recovery remain uncertain. In February 2026, the Company and an affiliated co-investor entered into a $ 69.3 million subordinate B-note secured by a portfolio of hotel properties. The Company committed approximately $ 48.3 million, and an affiliated co-investor committed the remaining $ 21.0 million, funding $ 45.3 million and $ 19.7 million, respectively, upon closing. The financing also included approximately $ 336.7 million of Senior A-note debt held by an unaffiliated third party and will refinance existing indebtedness on the properties. The subordinate B-note bears interest at a rate of SOFR plus 8.25 %, with a rate index floor of 3.00 %. The subordinate B-note is secured by a first mortgage (and lease-hold mortgage on two properties) and related collateral interests pursuant to the terms of the credit agreement and related loan documents. The proceeds of the loan will be used to refinance existing debt, provides an “earn out” and stabilizes the assets. In February 2026, the Company entered into Amendment Number Seven to the Loan and Security Agreement (“Amendment Number Seven”), by and among the Company and certain subsidiaries, as borrowers, the lenders party thereto, and East West Bank, which, among other things (i) facilitated the entry of an additional lender; (ii) increased the aggregate commitment by $ 25.0 million, for a total maximum revolver usage of $ 165.0 million; and (iii) revised the required consent from certain lenders to advance additional funds under the Revolving Credit Agreement. In March 2026, the Company’s Board of Directors declared a regular cash dividend of $ 0.30 per outstanding share of common stock for the first quarter of 2026 to shareholders of record as of March 31, 2026, which will be paid on April 15, 2026. F-27 Table of Contents SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: March 12, 2026 SUNRISE REALTY TRUST, INC. By: /s/ Brian Sedrish Brian Sedrish Chief Executive Officer and Director (Principal Executive Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Date: March 12, 2026 By: /s/ Brian Sedrish Brian Sedrish Chief Executive Officer and Director (Principal Executive Officer) By: /s/ Brandon Hetzel Brandon Hetzel Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer) By: /s/ Jodi Hanson Bond Jodi Hanson Bond Director By: /s/ James C. Fagan James C. Fagan Director By: /s/ Alexander Frank Alexander Frank Director By: /s/ Leonard M. Tannenbaum Leonard M. Tannenbaum Executive Chairman